By:  Armbrister                                        S.B. No. 626
                                 A BILL TO BE ENTITLED
                                        AN ACT
    1-1  relating to certain laws governing water districts and nonprofit
    1-2  water or sewer service corporations; creating penalties.
    1-3        BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
    1-4        SECTION 1.  Section 1.002, Water Code, is amended to read as
    1-5  follows:
    1-6        Sec. 1.002.  Construction of Code.  (a)  The Code
    1-7  Construction Act (Chapter 311, Government Code) applies to the
    1-8  construction of each provision in this code, except as otherwise
    1-9  expressly provided by this code.
   1-10        (b)  In this code:
   1-11              (1)  a reference to a title, chapter, or section
   1-12  without further identification is a reference to a title, chapter,
   1-13  or section of this code; and
   1-14              (2)  a reference to a subtitle, subchapter, subsection,
   1-15  subdivision, paragraph, or other numbered or lettered unit without
   1-16  further identification is a reference to a unit of the next larger
   1-17  unit of this code in which the reference appears.
   1-18        (c)  A reference in a law to a statute or part of a statute
   1-19  revised by this code is considered to be a reference to the part of
   1-20  this code that revises that statute or part of the statute.
   1-21        SECTION 2.  Chapter 50, Water Code, is repealed, except that
   1-22  Subchapter H is continued in effect for the sole purpose of the
   1-23  administration and operation of contracts created or issued under
    2-1  those laws.
    2-2        SECTION 3.  Title 4, Water Code, is amended by adding Chapter
    2-3  49 to read as follows:
    2-4          CHAPTER 49.  PROVISIONS APPLICABLE TO ALL DISTRICTS
    2-5                   SUBCHAPTER A.  GENERAL PROVISIONS
    2-6        Sec. 49.001.  DEFINITIONS.  As used in this chapter:
    2-7              (1)  "District" means any district or authority created
    2-8  by authority of either Article III, Sections 52(b)(1) and (2), or
    2-9  Article XVI, Section 59, of the Texas Constitution, regardless of
   2-10  how created.  The term "district" shall not include any navigation
   2-11  district or port authority created under general or special law.
   2-12              (2)  "Commission" means the Texas Natural Resource
   2-13  Conservation Commission.
   2-14              (3)  "Board" means the governing body of a district.
   2-15              (4)  "Executive director" means the executive director
   2-16  of the commission.
   2-17              (5)  "Water supply corporation" means a nonprofit water
   2-18  supply or sewer service corporation created or operating under
   2-19  Chapter 76, Acts of the 43rd Legislature, 1st Called Session, 1933
   2-20  (Article 1434a, Vernon's Texas Civil Statutes).
   2-21              (6)  "Director" means either a supervisor or director
   2-22  appointed or elected to the board.
   2-23              (7)  "Municipal solid waste" has the same meaning
   2-24  assigned by Section 361.003, Health and Safety Code.
   2-25              (8)  "River authority" means a river authority as that
    3-1  term is defined in Section 30.003, or a district created by a
    3-2  special Act of the legislature that:
    3-3                    (i)  is a provider of service to two or more
    3-4  municipalities; and
    3-5                    (ii)  is governed by a board of directors
    3-6  appointed or designated in whole or in part by the governor, the
    3-7  Texas Water Development Board, or municipalities within its service
    3-8  area.
    3-9        Sec. 49.002.  APPLICABILITY.  This chapter applies to all
   3-10  general and special law districts to the extent that the provisions
   3-11  of this chapter do not directly conflict with a provision in any
   3-12  other chapter of this code or any Act creating or affecting a
   3-13  special law district.  In the event of such conflict, the specific
   3-14  provisions in such other chapter or Act shall control.
   3-15        Sec. 49.003.  PENALTY.  A district that fails to comply with
   3-16  the filing provisions of this code may be subject to a civil
   3-17  penalty of up to $100 per day for each day the district wilfully
   3-18  continues to violate these provisions after receipt of written
   3-19  notice of violation from the executive director by certified mail,
   3-20  return receipt requested.  The state may sue to recover the
   3-21  penalty.
   3-22        Sec. 49.004.  PENALTY FOR VIOLATION OF DISTRICT RULES.
   3-23  (a)  The board may set reasonable civil penalties for the breach of
   3-24  any rule of the district that shall not exceed the jurisdiction of
   3-25  a justice court as provided by Section 27.031, Government Code.
    4-1        (b)  A penalty under this section is in addition to any other
    4-2  penalty provided by the law of this state and may be enforced by
    4-3  complaints filed in the appropriate court of jurisdiction in the
    4-4  county in which the district's principal office or meeting place is
    4-5  located.
    4-6        (c)  If the district prevails in any suit to enforce its
    4-7  rules, it may, in the same action, recover reasonable fees for
    4-8  attorneys, expert witnesses, and other costs incurred by the
    4-9  district before the court.  The amount of the attorney's fees shall
   4-10  be fixed by the court.
   4-11            (Sections 49.005-49.009 reserved for expansion
   4-12                        SUBCHAPTER B.  CREATION
   4-13        Sec. 49.010.  ORDER OR ACT CREATING DISTRICT.  Within 60 days
   4-14  after the date a district is created, the district shall file with
   4-15  the executive director a certified copy of the order or legislative
   4-16  act creating the district or authorizing its creation, unless the
   4-17  district was created by order of the commission.
   4-18            (Sections 49.011-49.050 reserved for expansion
   4-19               SUBCHAPTER C.  ADMINISTRATIVE PROVISIONS
   4-20        Sec. 49.051.  BOARD OF DIRECTORS.  A district shall be
   4-21  governed by its board, the number of which is otherwise provided by
   4-22  law.
   4-23        Sec. 49.052.  DISQUALIFICATION OF DIRECTORS.  (a)  A person
   4-24  is disqualified from serving as a member of a board of a district
   4-25  that includes less than all the territory in at least one county
    5-1  and which, if located within the corporate area of a city or
    5-2  cities, includes within its boundaries less than 75 percent of the
    5-3  incorporated area of the city or cities, if that person:
    5-4              (1)  is related within the third degree of affinity or
    5-5  consanguinity to a developer of property in the district, any other
    5-6  member of the board, or the manager, engineer, attorney, or other
    5-7  person providing professional services to the district;
    5-8              (2)  is an employee of any developer of property in the
    5-9  district or any director, manager, engineer, attorney, or other
   5-10  person providing professional services to the district or a
   5-11  developer of property in the district in connection with the
   5-12  district or property located in the district;
   5-13              (3)  is a developer of property in the district;
   5-14              (4)  is serving as an attorney, consultant, engineer,
   5-15  manager, architect, or in some other professional capacity for the
   5-16  district or a developer of property in the district in connection
   5-17  with the district or property located in the district;
   5-18              (5)(A)  is a party to a contract with or along with the
   5-19  district except for the purchase of public services furnished by
   5-20  the district to the public generally; or
   5-21                    (B)  is a party to a contract with or along with
   5-22  a developer of property in the district relating to the district or
   5-23  to property within the district, other than a contract limited
   5-24  solely to the purpose of purchasing or conveying real property in
   5-25  the district for the purpose of either establishing a permanent
    6-1  residence, establishing a commercial business within the district,
    6-2  or qualifying as a director; or
    6-3              (6)  during the term of office, fails to maintain the
    6-4  qualifications required by law to serve as a director.
    6-5        (b)  Within 60 days after the board determines a relationship
    6-6  or employment exists which constitutes a disqualification under
    6-7  subsection (a), it shall replace the person serving as a member of
    6-8  the board with a person who would not be disqualified.
    6-9        (c)  Any person who wilfully occupies an office as a member
   6-10  of a board and exercises the powers and duties of that office when
   6-11  disqualified under the provisions of subsection (a) is guilty of a
   6-12  misdemeanor and, on conviction, shall be fined not less than $100
   6-13  nor more than $1,000.
   6-14        (d)  As used in this section, "developer of property in the
   6-15  district" means any person who owns land located within a district
   6-16  covered under this section and who has divided or proposes to
   6-17  divide the land into two or more parts for the purpose of laying
   6-18  out any subdivision or any tract of land or any addition to any
   6-19  town or city, or for laying out suburban lots or building lots, or
   6-20  any lots, streets, alleys, or parks or other portions intended for
   6-21  public use, or the use of purchasers or owners of lots fronting
   6-22  thereon or adjacent thereto.
   6-23        (e)  Any rights obtained by any third party through official
   6-24  action of a board covered by this section are not impaired or
   6-25  affected by the disqualification under this section of any member
    7-1  of the board to serve, provided that the third party had no
    7-2  knowledge at the time the rights were obtained of the fact that the
    7-3  member of the board was disqualified to serve.
    7-4        (f)  This section shall not apply to river authorities,
    7-5  districts defined in Section 49.181(h)(4), or a district where the
    7-6  principal function of the district is to provide irrigation water
    7-7  to agricultural lands or to provide nonpotable water for any
    7-8  purpose.
    7-9        (g)  A board by unanimous vote of its remaining members may
   7-10  remove a board member only if that board member has missed one-half
   7-11  or more of the regular meetings scheduled during the prior 12
   7-12  months.  Any board member so removed may file a written appeal with
   7-13  the commission within 30 days after receiving written notice of the
   7-14  board action.  The commission may reinstate a removed director if
   7-15  the commission finds that the removal was unwarranted under the
   7-16  circumstances, including the reasons for absences, the time and
   7-17  place of the meetings missed, the business conducted at the
   7-18  meetings missed and any other facts or circumstances the commission
   7-19  may deem relevant.
   7-20        Sec. 49.053.  QUORUM.  A majority of the membership of the
   7-21  board constitutes a quorum for any meeting, and a concurrence of a
   7-22  majority of the entire membership of the board is sufficient for
   7-23  transacting any business of the district.  This section does not
   7-24  apply to river authorities.
   7-25        Sec. 49.054.  OFFICERS.  (a)  After a district is created and
    8-1  the directors have qualified, the board shall meet, elect a
    8-2  president, vice-president, secretary, and any other officers or
    8-3  assistant officers as the board may deem necessary and begin the
    8-4  discharge of its duties.
    8-5        (b)  After each directors election, the board shall meet and
    8-6  elect officers.
    8-7        (c)  The president is the chief executive officer of the
    8-8  district, presides at all meetings of the board, and shall execute
    8-9  all documents on behalf of the district.  The vice-president shall
   8-10  act as president in case of the absence or disability of the
   8-11  president.  The secretary is responsible for seeing that all
   8-12  records and books of the district are properly kept and shall
   8-13  attest the president's signature on all documents.
   8-14        (d)  The board may appoint another director, the general
   8-15  manager, or any employee as assistant or deputy secretary to assist
   8-16  the secretary, and any such person shall be entitled to certify as
   8-17  to the authenticity of any record of the district, including but
   8-18  not limited to all proceedings relating to bonds, contracts, or
   8-19  indebtedness of the district.
   8-20        (e)  After any election or appointment of a director, a
   8-21  district shall notify the executive director within 30 days after
   8-22  the date of the election or appointment of the name and mailing
   8-23  address of the director chosen and the date that director's term of
   8-24  office expires.  The executive director shall provide forms to the
   8-25  district for such purpose.
    9-1        (f)  This section does not apply to river authorities.
    9-2        Sec. 49.055.  SWORN STATEMENT, BOND AND OATH OF OFFICE.
    9-3  (a)  As soon as practicable after a director is elected or
    9-4  appointed, that director shall make the sworn statement prescribed
    9-5  by the constitution for public office.
    9-6        (b)  As soon as practicable after a director has made the
    9-7  sworn statement, and before beginning to perform the duties of
    9-8  office, that director shall take the oath of office prescribed by
    9-9  the constitution for public officers.
   9-10        (c)  Before beginning to perform the duties of office, each
   9-11  director shall execute a bond for $10,000 payable to the district
   9-12  and conditioned on the faithful performance of that director's
   9-13  duties.  All bonds of the directors shall be approved by the board
   9-14  and paid for by the district.
   9-15        (d)  The sworn statement, bond, and oath shall be filed with
   9-16  the district and retained in its records.  A duplicate original of
   9-17  the sworn statement and the oath shall also be filed with the
   9-18  secretary of state within 10 days after their execution and need
   9-19  not be filed before the new director begins to perform the duties
   9-20  of office.
   9-21        (e)  This section does not apply to river authorities.
   9-22        Sec. 49.056.  GENERAL MANAGER.  (a)  The board may employ or
   9-23  contract with a person to perform such services as general manager
   9-24  for the district as the board may from time to time specify.  The
   9-25  board may delegate to the general manager full authority to manage
   10-1  and operate the affairs of the district subject only to orders of
   10-2  the board.
   10-3        (b)  The board may delegate to the general manager the
   10-4  authority to employ all persons necessary for the proper handling
   10-5  of the business and operation of the district and to determine the
   10-6  compensation to be paid all employees other than the general
   10-7  manager.
   10-8        (c)  Except as provided by Section 49.052, a director may be
   10-9  employed as general manager of the district, but the compensation
  10-10  of a general manager who also serves as a director shall be
  10-11  established by the other directors.
  10-12        Sec. 49.057.  MANAGEMENT OF DISTRICT.  (a)  The board shall
  10-13  be responsible for the management of all the affairs of the
  10-14  district.  The district shall employ or contract with all persons,
  10-15  firms, partnerships, corporations, or other entities, public or
  10-16  private, deemed necessary by the board for the conduct of the
  10-17  affairs of the district, including, but not limited to, engineers,
  10-18  attorneys, financial advisors, operators, bookkeepers, tax
  10-19  assessors and collectors, auditors, and administrative staff.
  10-20        (b)  The board shall adopt an annual budget.  All district
  10-21  employees are employed at the will of the district unless the
  10-22  district and employee execute a written employment contract.
  10-23        (c)  The board shall set the compensation and terms for
  10-24  consultants.
  10-25        (d)  In selecting attorneys, engineers, auditors, financial
   11-1  advisors, or other professional consultants, the district shall
   11-2  follow the procedures provided in the Professional Services
   11-3  Procurement Act, Subchapter A, Chapter 2254, Government Code.
   11-4        (e)  The board shall require an officer, employee, or
   11-5  consultant who collects, pays, or handles any funds of the district
   11-6  to furnish good and sufficient bond, payable to the district, in an
   11-7  amount determined by the board to be sufficient to safeguard the
   11-8  district.  The bond shall be conditioned on the faithful
   11-9  performance of that person's duties and on accounting for all funds
  11-10  and property of the district.  Such bond shall be signed or
  11-11  endorsed by a surety company authorized to do business in the
  11-12  state.
  11-13        (f)  The board may pay the premium on surety bonds required
  11-14  of officials, employees, or consultants of the district out of any
  11-15  available funds of the district, including proceeds from the sale
  11-16  of bonds.
  11-17        (g)  The board may adopt bylaws to govern the affairs of the
  11-18  district to perform its purposes.  The board may, by resolution,
  11-19  authorize its general manager or other employee to execute
  11-20  documents on behalf of the district.
  11-21        (h)  The board shall also have the right to purchase all
  11-22  materials, supplies, equipment, vehicles, and machinery needed by
  11-23  the district to perform its purposes.
  11-24        Sec. 49.058.  CONFLICTS OF INTEREST.  A director of a
  11-25  district is subject to the provisions of Chapter 171, Local
   12-1  Government Code, relating to the regulation of conflicts of
   12-2  officers of local governments.
   12-3        Sec. 49.059.  DISQUALIFICATION OF TAX ASSESSOR AND COLLECTOR.
   12-4  (a)  No person may serve as tax assessor and collector of a
   12-5  district providing potable water or sewer utility services to
   12-6  household users if that person:
   12-7              (1)  is related within the third degree of affinity or
   12-8  consanguinity to any developer of property in the district, a
   12-9  member of the board, or the manager, engineer, or attorney for the
  12-10  district;
  12-11              (2)  is or was within two years immediately preceding
  12-12  the assumption of their assessment and collection duties with the
  12-13  district an employee of any developer of property in the district,
  12-14  or any director, manager, engineer, or attorney for the district;
  12-15              (3)  owns an interest in or is employed by any
  12-16  corporation organized for the purpose of tax assessment and
  12-17  collection services, a substantial portion of the stock of which is
  12-18  owned by a developer of property within the district or any
  12-19  director, manager, engineer, or attorney for the district; or
  12-20              (4)  is directly or through a corporation developing
  12-21  land in the district or is a director, engineer, or attorney for
  12-22  the district.
  12-23        (b)  Within 60 days after the board determines a relationship
  12-24  or employment exists which constitutes a disqualification under
  12-25  Subsection (a), it shall replace the person serving as tax assessor
   13-1  and collector with a person who would not be disqualified.
   13-2        (c)  Any person who wilfully violates the provisions of
   13-3  Subsection (a) is guilty of a misdemeanor and on conviction shall
   13-4  be fined not less than $100 nor more than $1,000.
   13-5        (d)  As used in this section, "developer of property in the
   13-6  district" has the same meaning as in Section 49.052(d).
   13-7        Sec. 49.060.  FEES OF OFFICE; REIMBURSEMENT.  (a)  A director
   13-8  is entitled to receive fees of office of not more than $100 a day
   13-9  for each day the director actually spends performing the duties of
  13-10  a director.  The fees of office may not exceed $6,000 per annum
  13-11  except for directors of a river authority which is engaged in the
  13-12  distribution and sale of electric energy to the public.
  13-13        (b)  Each director is also entitled to receive reimbursement
  13-14  of actual expenses reasonably and necessarily incurred while
  13-15  engaging in activities on behalf of the district.
  13-16        (c)  In order to receive fees of office and to receive
  13-17  reimbursement for expenses, each director shall file with the
  13-18  district a verified statement showing the number of days actually
  13-19  spent in the service of the district and a general description of
  13-20  the duties performed for each day of service.
  13-21        (d)  Section 49.002 notwithstanding, in all areas of conflict
  13-22  the provisions of this section shall take precedence over all prior
  13-23  statutory enactments.  If the enactment of this section results in
  13-24  an increase in the fees of office for any district, that district's
  13-25  fees of office shall not increase unless the board adopts a
   14-1  resolution authorizing payment of the higher fees.
   14-2        Sec. 49.061.  SEAL.  The directors shall adopt a seal for the
   14-3  district.
   14-4        Sec. 49.062.  OFFICES AND MEETING PLACES.  (a)  The board
   14-5  shall designate from time to time and maintain one or more regular
   14-6  offices for conducting the business of the district and maintaining
   14-7  the records of the district.  Such offices may be located either
   14-8  inside or outside the district's boundaries as determined in the
   14-9  discretion of the board.
  14-10        (b)  The board shall designate one or more places inside or
  14-11  outside the district for conducting the meetings of the board.  The
  14-12  meeting place may be a private residence or office, provided that
  14-13  the board, in its order establishing the meeting place, declares
  14-14  the same to be a public place and invites the public to attend any
  14-15  meeting of the board.  If the board establishes a meeting place or
  14-16  places outside the district, it shall give notice of the location
  14-17  or locations by filing a true copy of the resolution establishing
  14-18  the location or locations of the meeting place or places with the
  14-19  commission and also by publishing notice of the location or
  14-20  locations in a newspaper of general circulation in the district.
  14-21  If the location of any of the meeting places outside the district
  14-22  is changed, notice of the change shall be given in the same manner.
  14-23        (c)  After at least 25 qualified electors are residing in a
  14-24  district, on written request of at least five of those electors,
  14-25  the board shall designate a meeting place and hold meetings within
   15-1  the district if it determines that the meeting place used by the
   15-2  district deprives the residents of a reasonable opportunity to
   15-3  attend district meetings.  On the failure to designate the location
   15-4  of the meeting place within the district, five electors may
   15-5  petition the commission to designate a location.  If it determines
   15-6  that the meeting place used by the district deprives the residents
   15-7  of a reasonable opportunity to attend district meetings, the
   15-8  commission may designate a meeting place inside or outside the
   15-9  district which is reasonably available for the public and require
  15-10  that the meetings be held at such place.  After the next election,
  15-11  the board may designate different meeting places, including one
  15-12  located outside the boundaries of the district.
  15-13        (d)  Two or more districts may designate and share offices
  15-14  and meeting places.  This section does not apply to river
  15-15  authorities.
  15-16        Sec. 49.063.  NOTICE OF MEETINGS.  Notice of meetings of the
  15-17  board shall be given as set forth in the Open Meetings Act, Chapter
  15-18  551, Government Code, except that if a district does not have a
  15-19  meeting place within the district, the district shall post notice
  15-20  of its meeting at a public place within the district specified by
  15-21  the board in a written resolution, rather than at its
  15-22  administrative office.  The board shall specify such public place
  15-23  to be a bulletin board or other place within the district which is
  15-24  reasonably available to the public.  Neither failure to provide
  15-25  notice of a regular meeting nor an insubstantial defect in notice
   16-1  of any meeting shall affect the validity of any action taken at the
   16-2  meeting.
   16-3        Sec. 49.064.  MEETINGS.  The board shall hold such regular
   16-4  and special meetings as may be necessary for the proper conduct of
   16-5  the district's business.  All meetings shall be conducted in
   16-6  accordance with the Open Meetings Act, Chapter 551, Government
   16-7  Code.  A meeting of a committee of the board, or a committee
   16-8  composed of representatives of more than one board, where less than
   16-9  a quorum of any one board is present is not subject to the
  16-10  provisions of the Open Meetings Act, Chapter 551, Government Code.
  16-11        Sec. 49.065.  RECORDS.  (a)  The board shall keep a complete
  16-12  account of all its meetings and proceedings and shall preserve its
  16-13  minutes, contracts, records, notices, accounts, receipts, and other
  16-14  records in a safe place.
  16-15        (b)  The records of each district are the property of the
  16-16  district and are subject to the Open Records Act, Chapter 552,
  16-17  Government Code.
  16-18        (c)  The preservation, microfilming, destruction, or other
  16-19  disposition of the records of each district is subject to the
  16-20  requirements of Chapter 201, Local Government Code, and rules
  16-21  adopted thereunder.
  16-22        Sec. 49.066.  SUITS.  (a)  A district may sue and be sued in
  16-23  the courts of this state in the name of the district by and through
  16-24  its board.  All courts shall take judicial notice of the creation
  16-25  of the district and of its boundaries.
   17-1        (b)  Any court in the state rendering judgment for debt
   17-2  against a district may order the board to levy, assess, and collect
   17-3  taxes or assessments to pay the judgment.
   17-4        (c)  The president or the general manager of any district
   17-5  shall be the agent of the district on whom process, notice, or
   17-6  demand required or permitted by law to be served upon the district
   17-7  may be served.
   17-8        (d)  Except as provided in subsection (e), no suit may be
   17-9  instituted in any court of this state contesting:
  17-10              (1)  the validity of the creation and boundaries of a
  17-11  district created under this code;
  17-12              (2)  any bonds or other obligations created under this
  17-13  code; or
  17-14              (3)  the validity or the authorization of a contract
  17-15  with the United States by the district.
  17-16        (e)  The matters listed in subsection (d) may be judicially
  17-17  inquired into at any time and determined in any suit brought by the
  17-18  State of Texas through the attorney general.  The action shall be
  17-19  brought on good cause shown, except where otherwise provided by
  17-20  other provisions of this code or by the Texas Constitution.  It is
  17-21  specifically provided, however, that no such proceeding shall
  17-22  affect the validity of or security for any bonds or other
  17-23  obligations theretofore issued by a district if such bonds or other
  17-24  obligations have been approved by the attorney general as provided
  17-25  by Section 49.184.
   18-1        (f)  A district or water supply corporation shall not be
   18-2  required to give bond for appeal, injunction, or costs in any suit
   18-3  to which it is a party and shall not be required to deposit more
   18-4  than the amount of any award in any eminent domain proceeding.
   18-5        Sec. 49.067.  CONTRACTS.  A district shall contract, and be
   18-6  contracted with, in the name of the district.
   18-7        Sec. 49.068.  CONTRACTS WITH GOVERNMENTAL AGENCIES.  The
   18-8  provisions of this chapter pertaining to bids and the Local
   18-9  Government Code notwithstanding, a district may purchase property
  18-10  from any governmental entity by negotiated contract without the
  18-11  necessity of securing appraisals or advertising for bids.
  18-12        Sec. 49.069.  EMPLOYEE BENEFITS.  (a)  The board may provide
  18-13  for and administer a retirement, disability, and death compensation
  18-14  fund for the employees of the district and may adopt a plan or
  18-15  plans to effectuate the purpose of this section, including the
  18-16  forms of insurance and annuities which are considered advisable by
  18-17  the board.  The board, after notice to the employees and a hearing,
  18-18  may change any plan, rule, or regulation.
  18-19        (b)  All money provided from the compensation of the
  18-20  employees participating in the fund and plan authorized by this
  18-21  section and by the district for the retirement, disability, and
  18-22  death compensation fund, after the money has been received by the
  18-23  district, shall be invested as the board from time to time
  18-24  considers advisable.  The money may be invested in the following
  18-25  manner:
   19-1              (1)  in bonds of the United States, the State of Texas,
   19-2  any county, city, or other political subdivision of this state, or
   19-3  in bonds issued by any agency of the United States, the payment of
   19-4  the principal of and interest on which is guaranteed by the United
   19-5  States; and
   19-6              (2)  in life insurance policies, endowment or annuity
   19-7  contracts, or interest-bearing certificates of legal reserve life
   19-8  insurance companies authorized to write the contracts in the State
   19-9  of Texas.
  19-10        (c)  A sufficient amount of the money shall be kept on hand
  19-11  to meet the immediate payment of amounts likely to become due each
  19-12  year out of the fund as determined by the board.
  19-13        (d)  The recipients or beneficiaries from the fund shall not
  19-14  be eligible for any other pension, retirement fund, or direct aid
  19-15  from the State of Texas, unless the fund created under this chapter
  19-16  is released to the State of Texas as a condition precedent to
  19-17  receiving the other pension, aid, or joining of any other system.
  19-18        (e)  The board may include hospitalization and medical
  19-19  benefits to its employees as part of the compensation currently
  19-20  paid to the officers and employees and may adopt any plan, rule, or
  19-21  regulation in connection with it and amend or change the plan,
  19-22  rule, or regulation as it may determine.
  19-23        (f)  This section shall not apply to any river authority as
  19-24  that term is defined in Section 30.003(4).
  19-25        Sec. 49.070.  WORKERS' COMPENSATION.  The board may become a
   20-1  subscriber under the Texas Workers' Compensation Act (Article
   20-2  8308-1.01 et seq., Vernon's Texas Civil Statutes) with any
   20-3  insurance company authorized to write the policies in the State of
   20-4  Texas.
   20-5        Sec. 49.071.  DISTRICT NAME CHANGE.  (a)  On petition by a
   20-6  district showing reasonable grounds for a name change, the
   20-7  commission by order may change the name of the district to the name
   20-8  requested by the district.  The new name must be generally
   20-9  descriptive of the location of the district followed by the type of
  20-10  district as provided by the title of the chapter of the Water Code
  20-11  governing the district.  If a district is located wholly within one
  20-12  county that contains more than one district of that type, the
  20-13  district may be differentiated, if necessary, by adding to the new
  20-14  name the proper consecutive number.  The new name may not be the
  20-15  same as the name of any other district in the county.
  20-16        (b)  A name change takes effect on the date of issuance of
  20-17  the commission order making the name change.
  20-18        (c)  Not later than the 30th day after the date of issuance
  20-19  of the commission order making the name change, the district shall
  20-20  publish notice of the name change in a newspaper or newspapers of
  20-21  general circulation in the county or counties in which the district
  20-22  is located.  Within that same period, the district shall also give
  20-23  notice of the name change by mail to utility customers or
  20-24  permittees, if any, and, to the extent practicable, to the holders
  20-25  of bonds, obligations, and other indebtedness of the district.
   21-1  Failure of the district to comply with this subsection does not
   21-2  affect the validity of the name change.
   21-3        (d)  A change in the name of a district does not affect
   21-4  bonds, obligations, or other indebtedness of the district existing
   21-5  before the name change occurred.
   21-6            (Sections 49.072-49.100 reserved for expansion
   21-7                  SUBCHAPTER D.  ELECTION PROVISIONS
   21-8        Sec. 49.101.  GENERAL.  All elections shall be generally
   21-9  conducted in accordance with the Election Code except as otherwise
  21-10  provided for by this code.  Write-in candidacies for any district
  21-11  office shall be governed by Subchapter C, Chapter 146, Election
  21-12  Code.
  21-13        Sec. 49.102.  CONFIRMATION AND DIRECTOR ELECTION.
  21-14  (a)  Before issuing any bonds or other obligations, an election
  21-15  shall be held within the boundaries of the proposed district to
  21-16  determine if the proposed district shall be established and, if the
  21-17  directors of the district are required by law to be elected, to
  21-18  elect permanent directors.
  21-19        (b)  Notice of a confirmation or director election shall
  21-20  state the day and place or places for holding the election, the
  21-21  propositions to be voted on, or the number of directors to be voted
  21-22  on.
  21-23        (c)  The ballots for a confirmation election shall be printed
  21-24  to provide for voting "For District" and "Against District."
  21-25  Ballots for a directors election shall provide the names of the
   22-1  persons appointed by the governing body who qualified and are
   22-2  serving as temporary directors at the time the election is called.
   22-3  The ballots shall also have blank places after the names of the
   22-4  temporary directors in which a voter may write the names of other
   22-5  persons for directors.
   22-6        (d)  Immediately after the confirmation and director
   22-7  election, the presiding judge shall take returns of the results to
   22-8  the temporary board.  The temporary board shall canvass the returns
   22-9  and declare the results at the earliest practicable time.
  22-10        (e)  If a majority of the votes cast in the election favor
  22-11  the creation of the district, then the temporary board shall
  22-12  declare that the district is created and enter the result in its
  22-13  minutes.  If a majority of the votes cast in the election are
  22-14  against the creation of the district, the temporary board shall
  22-15  declare that the district was defeated and enter the result in its
  22-16  minutes.  A copy of the order shall be filed with the commission.
  22-17        (f)  The order canvassing the results of the confirmation
  22-18  election shall contain a description of the district's boundaries
  22-19  and shall be filed with the executive director and in the deed
  22-20  records of the county or counties in which the district is located.
  22-21        (g)  The temporary board shall also declare the persons
  22-22  receiving the highest number of votes for directors to have been
  22-23  elected as permanent directors.
  22-24        (h)  Unless otherwise agreed, the directors shall decide the
  22-25  initial terms of office by lot, with a simple majority of directors
   23-1  serving until the second succeeding directors' election and the
   23-2  remaining directors serving until the next directors' election.
   23-3        (i)  The provisions of this section shall not be applicable
   23-4  to any district exercising the powers of Chapter 375, Local
   23-5  Government Code, or any district created by a special Act of the
   23-6  legislature that does not require a confirmation election.
   23-7        Sec. 49.103.  TERMS OF OFFICE OF DIRECTORS.  (a)  Except as
   23-8  provided by Section 49.102, the members of the board of a district
   23-9  shall serve for four-year terms.
  23-10        (b)  An election shall be held on the uniform election date,
  23-11  established by the Election Code, in either January or May of each
  23-12  even-numbered year to elect the appropriate number of directors.
  23-13        (c)  The permanent directors may assign a position number to
  23-14  each director's office, in which case directors shall thereafter be
  23-15  elected by position and not at large.
  23-16        (d)  A district may provide for the election of all
  23-17  directors, or a majority of directors, from single-member
  23-18  districts, which shall be geographically described within the
  23-19  boundaries of the district in a manner that is equitable for the
  23-20  electors within such districts and within the district generally.
  23-21        (e)  Section 49.002 notwithstanding, in all areas of conflict
  23-22  the provisions of Subsection (b) shall take precedence over all
  23-23  prior statutory enactments.
  23-24        Sec. 49.104.  ALTERNATIVE ELECTION PROCEDURES.  (a)
  23-25  Notwithstanding the provisions and requirements of the Election
   24-1  Code and general laws, any two or more districts situated in the
   24-2  same county and in which substantially all of the land is being or
   24-3  has been developed as part of a single community development plan
   24-4  and which are served by common water supply and waste disposal
   24-5  systems may by mutual agreement designate a common election office
   24-6  and common early and regular polling places within one or more of
   24-7  the districts, but outside the boundaries of one or more of the
   24-8  districts, for the conduct of director election proceedings and
   24-9  early and regular balloting in director elections.  This
  24-10  alternative election procedure may only be used if the common
  24-11  election office and polling places so designated:
  24-12              (1)  are within buildings open to the public;
  24-13              (2)  are within the boundaries of at least one of the
  24-14  districts;
  24-15              (3)  meet the requirements of the Election Code and
  24-16  general laws as polling places; and
  24-17              (4)  are located not more than five miles from any
  24-18  portion of the boundaries of any of the participating districts.
  24-19        (b)  Such districts may also agree upon and designate a
  24-20  common election officer and common early and regular voting
  24-21  officials for some or all of the director elections to be
  24-22  simultaneously conducted at a common location, any of whom may be
  24-23  nonelective employees of one or more of the districts, so long as
  24-24  the early and regular voting officials are qualified voters within
  24-25  at least one of the districts.
   25-1        Sec. 49.105.  VACANCIES.  (a)  Except as otherwise provided
   25-2  in this code, all vacancies on the board and in other offices shall
   25-3  be filled for the unexpired term by appointment of the board.
   25-4        (b)  If the number of directors is reduced to fewer than a
   25-5  majority, the vacancies shall be filled by appointment by the
   25-6  commission or the county commissioners court if the district was
   25-7  created by the county commissioners court.  An appointed director
   25-8  shall serve for the unexpired term of the director he or she is
   25-9  replacing.
  25-10        (c)  In the event of a failure to elect one or more members
  25-11  of the board of a district resulting from the absence of, or
  25-12  failure to vote by, the qualified voters in the district, the
  25-13  current members of the board holding the positions not filled at
  25-14  such election shall be deemed to have been reelected and shall
  25-15  serve an additional term of office.
  25-16        Sec. 49.106.  BOND ELECTIONS.  (a)  Before an election is
  25-17  held to authorize the issuance of bonds, other than refunding
  25-18  bonds, there shall be filed in the office of the district and open
  25-19  to inspection by the public an engineer's report covering the land,
  25-20  improvements, facilities, plants, equipment, and appliances to be
  25-21  purchased or constructed and their estimated cost, together with
  25-22  maps, plats, profiles, and data fully showing and explaining the
  25-23  report.
  25-24        (b)  Notice of a bond election shall contain the proposition
  25-25  or propositions to be voted upon, which includes the estimate of
   26-1  the probable cost of design, construction, purchase and acquisition
   26-2  of improvements and additions thereto, and incidental expenses
   26-3  connected with such improvements and the issuance of bonds.
   26-4        (c)  A bond election may be held on the same day as any other
   26-5  district election.  The bond election may be called by a separate
   26-6  election order or as a part of any other election order.  The board
   26-7  may submit multiple purposes in a single proposition at an
   26-8  election.
   26-9        Sec. 49.107.  OPERATION AND MAINTENANCE TAX.  (a)  A district
  26-10  may levy and collect a tax for operation and maintenance purposes,
  26-11  including funds for planning, constructing, acquiring, maintaining,
  26-12  repairing, and operating all necessary land, plants, works,
  26-13  facilities, improvements, appliances, and equipment of the district
  26-14  and for paying costs of proper services, engineering and legal
  26-15  fees, and organization and administrative expenses.
  26-16        (b)  An operation and maintenance tax may not be levied by a
  26-17  district until it is approved by a majority of the electors voting
  26-18  at an election held for that purpose.  After such a tax has been
  26-19  authorized by the district's voters, the board shall be authorized
  26-20  to levy the tax and have it assessed and collected as other
  26-21  district taxes.
  26-22        (c)  An operation and maintenance tax election may be held at
  26-23  the same time and in conjunction with any other district election.
  26-24  The election may be called by a separate election order or as part
  26-25  of any other election order.
   27-1        (d)  The proposition in an operation and maintenance tax
   27-2  election may be for a specific maximum rate or for an unlimited
   27-3  rate.
   27-4        (e)  If a district has any surplus operation and maintenance
   27-5  tax funds that are not needed for the purposes for which they were
   27-6  collected, the funds may be used for any lawful purpose.
   27-7        (f)  Before a district reimburses a developer of property in
   27-8  the district, as that term is defined in Section 49.052(d), or its
   27-9  assigns, from operation and maintenance tax funds, for planning,
  27-10  construction or acquiring facilities, the district shall obtain
  27-11  approval by the executive director.
  27-12        Sec. 49.108.  CONTRACT ELECTIONS.  (a)  A contract may
  27-13  provide that the district will make payment under the contract from
  27-14  proceeds from the sale of notes or bonds, from taxes, or from any
  27-15  other income of the district or any combination of these.
  27-16        (b)  A district may make payments under a contract from taxes
  27-17  other than operation and maintenance taxes after the provisions of
  27-18  the contract have been approved by a majority of the electors
  27-19  voting at an election held for that purpose.
  27-20        (c)  A contract election may be held at the same time and in
  27-21  conjunction with any other district election.  The election may be
  27-22  called by a separate election order or as part of any other
  27-23  election order.
  27-24        (d)  A contract approved by the voters will constitute an
  27-25  obligation against the taxing power of the district to the extent
   28-1  provided in the contract.
   28-2            (Sections 49.109-49.150 reserved for expansion
   28-3                   SUBCHAPTER E.  FISCAL PROVISIONS
   28-4        Sec. 49.151.  EXPENDITURES.  (a)  Except as hereinafter
   28-5  provided, a district's money may be disbursed only by check, draft,
   28-6  order, or other instrument that shall be signed by at least a
   28-7  majority of the directors.
   28-8        (b)  The board may by resolution allow the general manager,
   28-9  treasurer, bookkeeper, or other employee of the district to sign
  28-10  disbursements.
  28-11        (c)  The board may by resolution allow disbursements to be
  28-12  transferred by federal reserve wire system to accounts in the name
  28-13  of the district.
  28-14        Sec. 49.152.  PURPOSES FOR BORROWING MONEY.  The district may
  28-15  borrow money for any corporate purpose or combination of corporate
  28-16  purposes only in compliance with the methods and procedures
  28-17  specifically provided by this chapter or by general law.
  28-18        Sec. 49.153.  REVENUE NOTES.  (a)  The board, without the
  28-19  necessity of an election, may borrow money on negotiable notes of
  28-20  the district to be paid solely from the revenues derived from the
  28-21  ownership of all or any designated part of the district's works,
  28-22  plants, improvements, facilities, or equipment after deduction of
  28-23  the reasonable cost of maintaining and operating the facilities.
  28-24        (b)  The notes may be first or subordinate lien notes within
  28-25  the discretion of the board, but no obligation may ever be a charge
   29-1  on the property of the district or on taxes levied or collected by
   29-2  the district but shall be solely a charge on the revenues pledged
   29-3  for the payment of the obligation.  No part of the obligation may
   29-4  ever be paid from taxes levied or collected by the district.
   29-5        (c)  A district may not execute a note for a term longer than
   29-6  three years unless the commission issues an order approving the
   29-7  note.
   29-8        (d)  This section does not apply to river authorities.
   29-9        Sec. 49.154.  BOND ANTICIPATION NOTES; TAX ANTICIPATION
  29-10  NOTES.  (a)  The board may declare an emergency in the matter of
  29-11  funds not being available to pay principal of and interest on any
  29-12  bonds of the district payable in whole or in part from taxes or to
  29-13  meet any other needs of the district and may issue negotiable tax
  29-14  anticipation notes or negotiable bond anticipation notes to borrow
  29-15  the money needed by the district without advertising or giving
  29-16  notice of the sale.  Bond anticipation notes and tax anticipation
  29-17  notes shall mature within one year of their date.
  29-18        (b)  Tax anticipation notes may be issued for any purpose for
  29-19  which the district is authorized to levy taxes, and tax
  29-20  anticipation notes shall be secured with the proceeds of taxes to
  29-21  be levied by the district in the succeeding 12-month period.  The
  29-22  board may covenant with the purchasers of the notes that the board
  29-23  will levy a sufficient tax to pay the principal of and interest on
  29-24  the notes and pay the costs of collecting the taxes.
  29-25        (c)  Bond anticipation notes may be issued for any purpose
   30-1  for which bonds of the district may have previously been voted or
   30-2  may be issued for the purpose of refunding previously issued bond
   30-3  anticipation notes.  A district may covenant with the purchasers of
   30-4  the bond anticipation notes that the district will use the proceeds
   30-5  of sale of any bonds in the process of issuance for the purpose of
   30-6  refunding the bond anticipation notes, in which case the board will
   30-7  be required to use the proceeds received from sale of the bonds in
   30-8  the process of issuance to pay principal, interest, or redemption
   30-9  price on the bond anticipation notes.
  30-10        (d)  Districts required to seek commission approval of bonds
  30-11  must have an application for such approval on file with the
  30-12  commission prior to the issuance of bond anticipation notes.
  30-13        Sec. 49.155.  REPAYMENT OF EXPENSES.  (a)  The district may
  30-14  pay all costs and expenses necessarily incurred in the organization
  30-15  and operation of a district during creation and construction
  30-16  periods including, but not limited to, the following:
  30-17              (1)  organizational, administrative, and operating
  30-18  expenses;
  30-19              (2)  the cost of investigation and making plans;
  30-20              (3)  the cost of the engineer's report;
  30-21              (4)  legal fees; and
  30-22              (5)  any other incidental expenses.
  30-23        (b)  For purposes of this section, construction periods shall
  30-24  mean any periods during which the district is constructing its
  30-25  facilities or there is construction by third parties of above
   31-1  ground improvements within the district, but in no event longer
   31-2  than five years.
   31-3        (c)  The district may reimburse any person for money advanced
   31-4  for the purposes in Subsection (a) and may be charged interest on
   31-5  such funds.
   31-6        (d)  These payments may be made from money obtained from the
   31-7  issuance of notes or the sale of bonds issued by the district or
   31-8  out of maintenance taxes or other revenues of the district.
   31-9        Sec. 49.156.  DEPOSITORY.  (a)  The board, by order or
  31-10  resolution, shall designate one or more banks or savings
  31-11  associations within the state to serve as the depository for the
  31-12  funds of the district.  The board shall not be required to
  31-13  advertise or solicit bids in selecting its depositories.
  31-14        (b)  To the extent that funds in the depository banks or
  31-15  savings associations are not insured by the Federal Deposit
  31-16  Insurance Corporation, they shall be secured in the manner provided
  31-17  by law for the security of funds by the Public Funds Collateral
  31-18  Act, Chapter 2257, Government Code.
  31-19        (c)  The board may authorize a designated representative to
  31-20  supervise the substitution of securities pledged to secure the
  31-21  district's funds.
  31-22        Sec. 49.157.  INVESTMENTS.  (a)  All district deposits and
  31-23  investments shall be governed by the Public Funds Investment Act,
  31-24  Chapter 2256, Government Code.
  31-25        (b)  The board may provide that an authorized representative
   32-1  of the district may invest and reinvest the funds of the district
   32-2  and provide for money to be withdrawn from the appropriate accounts
   32-3  of the district for the investments on such terms as the board
   32-4  considers advisable.
   32-5        Sec. 49.158.  FISCAL YEAR.  Within 30 days after a district
   32-6  becomes financially active, the board shall adopt a fiscal year by
   32-7  a formal board resolution.  The district shall notify the executive
   32-8  director of the adopted fiscal year within 30 days after adoption.
   32-9  The district may change its fiscal year at any time; provided,
  32-10  however, it may not be changed more than once in any 24 month
  32-11  period.  After any change in the district's fiscal year, the
  32-12  district shall notify the executive director of the changed fiscal
  32-13  year within 30 days after adoption.
  32-14            (Sections 49.159-49.180 reserved for expansion
  32-15                   SUBCHAPTER F.  ISSUANCE OF BONDS
  32-16        Sec. 49.181.  AUTHORITY OF COMMISSION OVER ISSUANCE OF
  32-17  DISTRICT BONDS.  (a)  A district may not issue bonds unless the
  32-18  commission determines that the project to be financed by the bonds
  32-19  is feasible and issues an order approving the issuance of the
  32-20  bonds.  This section does not apply to refunding bonds or bonds
  32-21  issued to and approved by the Farmers Home Administration, United
  32-22  States Department of Agriculture, or the Texas Water Development
  32-23  Board.
  32-24        (b)  A district may submit to the commission a written
  32-25  application for investigation of feasibility.  An engineer's report
   33-1  describing the project, including the data, profiles, maps, plans,
   33-2  and specifications prepared in connection with the report, must be
   33-3  submitted with the application.
   33-4        (c)  The executive director shall examine the application and
   33-5  the report and shall inspect the project area.  The district shall,
   33-6  on request, supply the executive director with additional data and
   33-7  information necessary for an investigation of the application, the
   33-8  engineer's report, and the project.
   33-9        (d)  The executive director shall prepare a written report on
  33-10  the project and include suggestions, if any, for changes or
  33-11  improvements in the project.  The executive director shall retain a
  33-12  copy of the report and send a copy of the report to both the
  33-13  commission and the district.
  33-14        (e)  The commission shall consider the application, the
  33-15  engineer's report, the executive director's report, and any other
  33-16  evidence allowed by commission rule to be considered in determining
  33-17  the feasibility of the project.
  33-18        (f)  The commission shall determine whether the project to be
  33-19  financed by the bonds is feasible and issue an order either
  33-20  approving or disapproving, as appropriate, the issuance of the
  33-21  bonds.  The commission shall retain a copy of the order and send a
  33-22  copy of the order to the district.
  33-23        (g)  Notwithstanding any provision of this code to the
  33-24  contrary, the commission may approve the issuance of bonds of a
  33-25  district without the submission of plans and specifications of the
   34-1  improvements to be financed with the bonds.  The commission may
   34-2  condition the approval on any terms or conditions considered
   34-3  appropriate by the commission.
   34-4        (h)  This section does not apply to a district if:
   34-5              (1)  the district's boundaries include one entire
   34-6  county;
   34-7              (2)  the district was created by a special Act of the
   34-8  legislature and:
   34-9                    (i)  the district is located entirely within one
  34-10  county;
  34-11                    (ii)  entirely within one or more home-rule
  34-12  municipalities;
  34-13                    (iii)  the total taxable value of the real
  34-14  property and improvements to the real property zoned by the one or
  34-15  more home-rule municipalities for residential purposes and located
  34-16  within the district does not exceed 25 percent of the total taxable
  34-17  value of all taxable property in the district, as shown by the most
  34-18  recent certified appraisal tax roll prepared by the appraisal
  34-19  district for the county; and
  34-20                    (iv)  the district was not required by law to
  34-21  obtain commission approval of its bonds before the effective date
  34-22  of this section;
  34-23              (3)  the district is a river authority; or
  34-24              (4)  the district is governed by a board of directors
  34-25  appointed in whole or in part by the governor, a state agency, or
   35-1  the governing body or chief elected official of a municipality or
   35-2  county and does not provide water and sewer services to residential
   35-3  retail customers as its principal function.
   35-4        Sec. 49.182.  COMMISSION SUPERVISION OF PROJECTS AND
   35-5  IMPROVEMENTS.  (a)  During construction of projects and
   35-6  improvements approved by the commission under this subchapter, no
   35-7  substantial alterations may be made in the plans and specifications
   35-8  without the approval of the commission in accordance with
   35-9  commission rules.
  35-10        (b)  The executive director may inspect the improvements at
  35-11  any time during construction to determine if the project is being
  35-12  constructed in accordance with the plans and specifications
  35-13  approved by the commission.
  35-14        (c)  If the executive director finds that the project is not
  35-15  being constructed in accordance with the approved plans and
  35-16  specifications, the executive director shall give written notice
  35-17  immediately by certified mail to the district's manager and to each
  35-18  board member.
  35-19        (d)  If within 10 days after the notice is mailed the board
  35-20  does not take steps to ensure that the project is being constructed
  35-21  in accordance with the approved plans and specifications, the
  35-22  executive director shall give written notice of this fact to the
  35-23  attorney general.
  35-24        (e)  After receiving this notice, the attorney general may
  35-25  bring an action for injunctive relief or quo warranto proceedings
   36-1  against the directors.  Venue for either suit is exclusively in a
   36-2  district court in Travis County.
   36-3        Sec. 49.183.  BOND SALES.  (a)  Except for refunding bonds,
   36-4  or bonds sold to a state or federal agency, bonds issued by a
   36-5  district shall be sold after advertising for and receiving
   36-6  competitive sealed bids and shall be awarded to the bidder whose
   36-7  bid produces the lowest net effective interest rate to the
   36-8  district.
   36-9        (b)  Except for refunding bonds, bonds sold to a state or
  36-10  federal agency, after any bonds are finally approved and before
  36-11  they are sold by a district, the board shall publish an appropriate
  36-12  notice of the sale:
  36-13              (1)  at least one time not less than 10 days before the
  36-14  date of sale in a newspaper of general circulation in the county or
  36-15  counties in which the district is located; and
  36-16              (2)  at least one time in one or more recognized
  36-17  financial publications of general circulation in the state as
  36-18  approved by the state attorney general.
  36-19        (c)  If the district is issuing bonds and refunding bonds as
  36-20  one issue and if the initial principal amount of refunding bonds is
  36-21  50 percent or more of the total initial principal amount of bonds
  36-22  being issued, for the purposes of this section, the issue shall be
  36-23  considered to be refunding bonds and competitive bids shall not be
  36-24  required.
  36-25        (d)  A district's bonds are negotiable instruments within the
   37-1  meaning and purposes of the Business & Commerce Code.  A district's
   37-2  bonds may be issued and bear interest in accordance with Chapter
   37-3  503, Acts of the 54th Legislature, Regular Session, 1955 (Article
   37-4  717k, Vernon's Texas Civil Statutes); Chapter 3, Acts of the 61st
   37-5  Legislature, Regular Session, 1969 (Article 717k-2, Vernon's Texas
   37-6  Civil Statutes); the Bond Procedures Act of 1981 (Article 717k-6,
   37-7  Vernon's Texas Civil Statutes); and Chapter 656, Acts of the 68th
   37-8  Legislature, Regular Session, 1983 (Article 717q, Vernon's Texas
   37-9  Civil Statutes).  Except for this subsection, this section does not
  37-10  apply to river authorities or districts defined in Section
  37-11  49.181(h)(4).
  37-12        (e)  Subsections (a) and (b) do not apply to district bonds
  37-13  issued pursuant to Chapter 656, Acts of the 68th Legislature,
  37-14  Regular Session, 1983 (Article 717q, Vernon's Texas Civil
  37-15  Statutes).
  37-16        Sec. 49.184.  APPROVAL OF BONDS BY ATTORNEY GENERAL;
  37-17  REGISTRATION OF BONDS.  (a)  Before bonds issued by a district are
  37-18  delivered to the purchasers, a certified copy of all proceedings
  37-19  relating to organization of the district for first bond issues and
  37-20  issuance of the bonds and other relevant information shall be sent
  37-21  to the attorney general.
  37-22        (b)  The attorney general shall carefully examine the bonds,
  37-23  with regard to the record and the constitution and laws of this
  37-24  state governing the issuance of bonds, and the attorney general
  37-25  shall officially approve and certify the bonds if he or she finds
   38-1  that they conform to the record and the constitution and laws of
   38-2  this state and are valid and binding obligations of the district.
   38-3        (c)  After the attorney general approves and certifies the
   38-4  bonds, the comptroller shall register them in a book kept for that
   38-5  purpose and shall record the certificate of the attorney general.
   38-6        (d)  After the approval and registration of the bonds by the
   38-7  comptroller, they shall be incontestable in any court or other
   38-8  forum, for any reason, and shall be valid and binding obligations
   38-9  in accordance with their terms for all purposes.
  38-10        (e)  A contract or lease may be submitted to the attorney
  38-11  general along with the bond records, and, if submitted, the
  38-12  approval by the attorney general of the bonds shall constitute an
  38-13  approval of the contract or lease and the contract or lease shall
  38-14  be incontestable.
  38-15        Sec. 49.185.  EXEMPTIONS.  This subchapter shall not apply to
  38-16  districts engaged in the distribution and sale of electric energy
  38-17  to the public.
  38-18            (Sections 49.186-49.190 reserved for expansion
  38-19                   SUBCHAPTER G.  AUDIT OF DISTRICTS
  38-20        Sec. 49.191.  DUTY TO AUDIT.  (a)  The board shall have the
  38-21  district's fiscal accounts and records audited annually at the
  38-22  expense of the district.
  38-23        (b)  In all areas of conflict, the provisions of this
  38-24  subchapter shall take precedence over all prior statutory
  38-25  enactments.
   39-1        (c)  The person who performs the audit shall be a certified
   39-2  public accountant or public accountant holding a permit from the
   39-3  Texas State Board of Public Accountancy.
   39-4        (d)  The audit required by this section shall be completed
   39-5  within 120 days after the close of the district's fiscal year.
   39-6        Sec. 49.192.  FORM OF AUDIT.  The executive director shall
   39-7  adopt accounting and auditing manuals and, except as otherwise
   39-8  provided by the manuals, the district audit shall be performed
   39-9  according to the generally accepted auditing standards adopted by
  39-10  the American Institute of Certified Public Accountants.  Financial
  39-11  statements shall be prepared in accordance with generally accepted
  39-12  accounting principles as adopted by the American Institute of
  39-13  Certified Public Accountants.
  39-14        Sec. 49.193.  FINANCIAL REPORTS.  The district's  depository,
  39-15  the district's treasurer, and the district's bookkeeper, if any,
  39-16  who receives or has control over any district funds shall keep a
  39-17  full and itemized account of district funds in its, his, or her
  39-18  possession.  Such itemized accounts and records shall be available
  39-19  for audit.
  39-20        Sec. 49.194.  FILING OF AUDITS, AFFIDAVITS, AND FINANCIAL
  39-21  REPORTS.  (a)  After the board has approved the audit, it shall
  39-22  submit a copy of the report to the executive director for filing
  39-23  within 135 days after the close of the district's fiscal year.
  39-24        (b)  If the board refuses to approve the annual audit report,
  39-25  the board shall submit a copy of the report to the executive
   40-1  director for filing within 135 days after the close of the
   40-2  district's fiscal year, accompanied by a statement from the board
   40-3  explaining the reasons for its failure to approve the report.
   40-4        (c)  Copies of the audit, the annual financial dormancy
   40-5  affidavit, or annual financial report described in Sections 49.197
   40-6  and 49.198 of this subchapter shall be filed annually in the office
   40-7  of the district.
   40-8        (d)  Each district shall file with the executive director an
   40-9  annual filing affidavit in a format prescribed by the executive
  40-10  director, executed by a duly authorized representative of the
  40-11  board, stating that all copies of the annual audit report, annual
  40-12  financial dormancy affidavit, or annual financial report have been
  40-13  filed under this section.
  40-14        (e)  The annual filing affidavit shall be submitted with the
  40-15  applicable annual document when it is submitted to the executive
  40-16  director for filing as prescribed by this subchapter.
  40-17        (f)  The executive director shall file with the attorney
  40-18  general the names of any districts that do not comply with the
  40-19  provisions of this subchapter.
  40-20        Sec. 49.195.  REVIEW BY EXECUTIVE DIRECTOR.  (a)  The
  40-21  executive director may review the audit report of each district.
  40-22        (b)  The commission may request that the state auditor assist
  40-23  in the establishment of standards and procedures for review of
  40-24  district audits by the executive director.
  40-25        (c)  If the executive director has any objections or
   41-1  determines any violations of generally accepted auditing standards
   41-2  or accounting principles, statutes, or board rules, or if the
   41-3  executive director has any recommendations, he or she shall notify
   41-4  the board and the district's auditor.
   41-5        (d)  Before the audit report may be accepted by the executive
   41-6  director as being in compliance with the provisions of this
   41-7  subchapter, the board and the auditor shall remedy objections and
   41-8  correct violations of which they have been notified by the
   41-9  executive director.
  41-10        (e)  If the audit report indicates that any penal law has
  41-11  been violated, the executive director shall notify the appropriate
  41-12  county or district attorney and the attorney general.
  41-13        Sec. 49.196.  ACCESS TO AND MAINTENANCE OF DISTRICT RECORDS.
  41-14  (a)  The executive director shall have access to all vouchers,
  41-15  receipts, district fiscal and financial records, and other district
  41-16  records the executive director considers necessary.
  41-17        (b)  All district fiscal records shall be prepared on a
  41-18  timely basis and maintained in an orderly manner in accordance with
  41-19  generally accepted accounting principles.  The fiscal records shall
  41-20  be available for public inspection during regular business hours.
  41-21  A district's fiscal records may be removed from the district's
  41-22  office for the purposes of recording its fiscal affairs and
  41-23  preparing an audit, during which time the fiscal records are under
  41-24  the control of the district's auditor.
  41-25        Sec. 49.197.  FINANCIALLY DORMANT DISTRICTS.  (a)  A
   42-1  financially dormant district is a district that had:
   42-2              (1)  $500 or less of receipts from operations, tax
   42-3  assessments, loans, contributions, or any other sources during the
   42-4  calendar year;
   42-5              (2)  $500 or less of disbursements of funds during the
   42-6  calendar year;
   42-7              (3)  no bonds or other long-term (more than one year)
   42-8  liabilities outstanding during the calendar year; and
   42-9              (4)  no cash or investments that exceeded $5,000 at any
  42-10  time during the calendar year.
  42-11        (b)  A financially dormant district may elect to submit to
  42-12  the executive director a financial dormancy affidavit instead of
  42-13  complying with the audit requirements of Section 49.191.
  42-14        (c)  The annual financial dormancy affidavit shall be
  42-15  prepared in a format prescribed by the executive director and shall
  42-16  be submitted for filing by a duly authorized representative of the
  42-17  district.
  42-18        (d)  The affidavit must be filed annually on or before
  42-19  January 31 with the executive director until such time as the
  42-20  district becomes financially active and the board adopts a fiscal
  42-21  year; thereafter, the district shall file annual audit reports as
  42-22  prescribed by this subchapter.
  42-23        (e)  A district that becomes financially dormant after having
  42-24  been financially active shall be required to file annual financial
  42-25  dormancy affidavits on or before January 31, until such time the
   43-1  district is either dissolved or again becomes financially active.
   43-2        (f)  Districts governed by this section are subject to
   43-3  periodic audits by the executive director.
   43-4        Sec. 49.198.  AUDIT REPORT EXEMPTION.  (a)  A district that
   43-5  is not collecting taxes may elect to file annual financial reports
   43-6  with the executive director in lieu of the district's compliance
   43-7  with Section 49.191 provided:
   43-8              (1)  the district had no bonds or other long-term (more
   43-9  than one year) liabilities outstanding during the fiscal period;
  43-10              (2)  the district did not have gross receipts from
  43-11  operations, loans, or contributions in excess of $100,000 during
  43-12  the fiscal period; and
  43-13              (3)  the district's cash and temporary investments were
  43-14  not in excess of $100,000 at any time during the fiscal period.
  43-15        (b)  The annual financial report must be accompanied by an
  43-16  affidavit attesting to the accuracy and authenticity of the
  43-17  financial report signed by a duly authorized representative of the
  43-18  district.
  43-19        (c)  The annual financial report and affidavit in a format
  43-20  prescribed by the executive director must be on file with the
  43-21  executive director within 45 days after the close of the district's
  43-22  fiscal year.
  43-23        (d)  Districts governed by this section are subject to
  43-24  periodic audits by the executive director.
  43-25        Sec. 49.199.  POLICIES AND AUDITS OF DISTRICTS.  (a)  Subject
   44-1  to the law governing the district, the board shall adopt the
   44-2  following in writing:
   44-3              (1)  a code of ethics for district directors, officers,
   44-4  employees, and persons who are engaged in handling investments for
   44-5  the district;
   44-6              (2)  a policy relating to travel expenditures;
   44-7              (3)  a policy relating to district investments that
   44-8  ensures that:
   44-9                    (A)  purchases and sales of investments are
  44-10  initiated by authorized individuals, conform to investment
  44-11  objectives and regulations, and are properly documented and
  44-12  approved; and
  44-13                    (B)  periodic review is made of district
  44-14  investments to evaluate investment performance and security;
  44-15              (4)  policies and procedures for selection, monitoring,
  44-16  or review and evaluation of professional services;
  44-17              (5)  a uniform method of accounting and reporting for
  44-18  industrial development bonds and pollution control bonds that
  44-19  complies with requirements of the commission; and
  44-20              (6)  policies that ensure a better use of management
  44-21  information including:
  44-22                    (A)  budgets for use in planning and controlling
  44-23  cost;
  44-24                    (B)  an audit committee of the board; and
  44-25                    (C)  uniform reporting requirements that use
   45-1  "Audits of State and Local Governmental Units" as a guide on audit
   45-2  working papers and that uses "Governmental Accounting and Financial
   45-3  Reporting Standards."
   45-4        (b)  The state auditor may audit the financial transactions
   45-5  of any district if the state auditor determines that the audit is
   45-6  necessary.
   45-7        Sec. 49.200.  REVIEW AND COMMENT ON BUDGET OF CERTAIN
   45-8  DISTRICTS.  A district that provides wholesale potable water and
   45-9  waste water services shall adopt a program that provides such
  45-10  wholesale customers an opportunity to review and comment on the
  45-11  district's annual budget that applies to their services before that
  45-12  budget is adopted by the board.
  45-13            (Sections 49.201-49.210 reserved for expansion
  45-14                   SUBCHAPTER H.  POWERS AND DUTIES
  45-15        Sec. 49.211.  POWERS.  (a)  A district shall have the
  45-16  functions, powers, authority, rights, and duties that will permit
  45-17  accomplishment of the purposes for which it was created or the
  45-18  purposes authorized by the constitution, this code, or any other
  45-19  law.
  45-20        (b)  A district is authorized to purchase, construct,
  45-21  acquire, own, operate, maintain, repair, improve, or extend inside
  45-22  and outside its boundaries any and all land, works, improvements,
  45-23  facilities, plants, equipment, and appliances necessary to
  45-24  accomplish the purposes of its creation or the purposes authorized
  45-25  by this code or any other law.
   46-1        Sec. 49.212.  FEES AND CHARGES.  (a)  A district may adopt
   46-2  and enforce all necessary charges, fees, or rentals, in addition to
   46-3  taxes, for providing or making available any district facility or
   46-4  service.
   46-5        (b)  A district may require a deposit for any services or
   46-6  facilities furnished and the district may or may not provide that
   46-7  the deposit will bear interest.
   46-8        (c)  Subject to observance of the procedure appropriate to
   46-9  the circumstances, a district may discontinue any or all facilities
  46-10  or services to prevent an abuse or to enforce payment of an unpaid
  46-11  charge, fee, or rental due the district, including taxes which have
  46-12  been delinquent for not less than six months.
  46-13        (d)  Notwithstanding any provision of law to the contrary, a
  46-14  district that charges a fee that is an impact fee as described in
  46-15  Section 395.001(4), Local Government Code, must comply with Chapter
  46-16  395, Local Government Code.  A charge or fee by a district for
  46-17  construction, installation, or inspection of a tap or connection to
  46-18  district water, sanitary sewer, or drainage facilities, including
  46-19  all necessary service lines and meters, which (i) does not exceed
  46-20  three (3) times the actual and reasonable costs to the district for
  46-21  such work or (ii), if made to a nontaxable entity, does not exceed
  46-22  the actual costs to the district for such work and for all
  46-23  facilities that are necessary to provide district services to such
  46-24  entity and that are financed or are to be financed in whole or in
  46-25  part by tax-supported bonds of the district, shall not be deemed or
   47-1  considered to be an impact fee under Chapter 395, Local Government
   47-2  Code.
   47-3        Sec. 49.213.  AUTHORITY TO ISSUE CONTRACTS.  (a)  A district
   47-4  may contract with a person or any public or private entity for the
   47-5  joint construction, financing, ownership, and operation of any
   47-6  works, improvements, facilities, plants, equipment, and appliances
   47-7  necessary to accomplish any purpose or function permitted by a
   47-8  district, or a district may purchase an interest in any project
   47-9  used for any purpose or function permitted by a district.
  47-10        (b)  a district may enter into contracts with any person or
  47-11  any public or private entity in the performance of any purpose or
  47-12  function permitted by a district.
  47-13        (c)  A district may enter into contracts, which may be of
  47-14  unlimited duration, with persons or any public or private entities
  47-15  on the terms and conditions the board may consider desirable, fair,
  47-16  and advantageous for:
  47-17              (1)  the purchase or sale of water;
  47-18              (2)  the collection, transportation, treatment, and
  47-19  disposal of its domestic, industrial, and communal wastes or the
  47-20  collection, transportation, treatment, and disposal of domestic,
  47-21  industrial, and communal wastes of other persons;
  47-22              (3)  the gathering, diverting, and control of local
  47-23  storm water, or other local harmful excesses of water;
  47-24              (4)  the continuing and orderly development of the land
  47-25  and property within the district through the purchase,
   48-1  construction, or installation of works, improvements, facilities,
   48-2  plants, equipment, and appliances that the district may otherwise
   48-3  be empowered and authorized to do or perform so that, to the
   48-4  greatest extent reasonably possible, considering sound engineering
   48-5  and economic practices, all of the land and property may be placed
   48-6  in a position to ultimately receive the services of the works,
   48-7  improvements, plants, facilities, equipment, and appliances;
   48-8              (5)  the maintenance and operation of any works,
   48-9  improvements, facilities, plants, equipment, and appliances of the
  48-10  district or of another person or public or private entity;
  48-11              (6)  the collection, treatment, and disposal of
  48-12  municipal solid wastes;
  48-13              (7)  the exercise of any other rights, powers, and
  48-14  duties granted to a district.
  48-15        Sec. 49.214.  CONFLICTS OF INTEREST IN CONTRACTS.  The
  48-16  provisions of Chapter 171, Local Government Code, shall apply to
  48-17  the award of district contracts.
  48-18        Sec. 49.215.  SERVICE TO AREAS OUTSIDE THE DISTRICT.  (a)  A
  48-19  district may purchase, construct, acquire, own, operate, repair,
  48-20  improve, or extend all works, improvements, facilities, plants,
  48-21  equipment, and appliances necessary to provide any services or
  48-22  facilities authorized to be provided by the district to areas
  48-23  contiguous to or in the vicinity of the district provided the
  48-24  district does not duplicate a service or facility of another public
  48-25  entity.  A district providing potable water and sewer utility
   49-1  services to household users shall not provide services or
   49-2  facilities to serve areas outside the district that are also within
   49-3  the corporate limits of a city without securing a resolution or
   49-4  ordinance of the city granting consent for the district to serve
   49-5  the area within the city.
   49-6        (b)  To secure money for this purpose, a district is
   49-7  authorized to issue and sell negotiable bonds and notes payable
   49-8  from the levy and collection of ad valorem taxes on all taxable
   49-9  property within the district or from all or any designated part of
  49-10  the revenues received from the operation of the district's works,
  49-11  improvements, facilities, plants, equipment, and appliances or from
  49-12  a combination of taxes and revenues.
  49-13        (c)  Any bonds and notes may be issued upon the terms and
  49-14  conditions set forth in this code.
  49-15        (d)  A district shall not be required to hold a certificate
  49-16  of convenience and necessity as a precondition for providing retail
  49-17  water or sewer service to any customer or service area,
  49-18  notwithstanding the fact that such customer or service area may be
  49-19  located either within or outside the boundaries of the district or
  49-20  has previously received water or sewer service from an entity
  49-21  required by law to hold a certificate of convenience and necessity
  49-22  as a precondition for such service.  This subsection does not
  49-23  authorize a district to provide services within an area for which a
  49-24  retail public utility holds a certificate of convenience and
  49-25  necessity or within the boundaries of another district without that
   50-1  district's consent, unless the district has a valid certificate of
   50-2  convenience and necessity to provide services to that area.
   50-3        (e)  A district is authorized to establish, maintain, revise,
   50-4  charge, and collect the rates, fees, rentals, tolls, or other
   50-5  charges for the use, services, and facilities that provide service
   50-6  to areas outside the district that are considered necessary and may
   50-7  be higher than those charged for comparable service to users within
   50-8  the district.
   50-9        (f)  The rates, fees, rental, tolls, or other charges shall
  50-10  be at least sufficient to meet the expense of operating and
  50-11  maintaining the services and facilities for water and sanitary
  50-12  sewer system serving areas outside the district and to pay the
  50-13  principal of and interest and redemption price on bonds issued to
  50-14  purchase, construct, acquire, own, operate, repair, improve, or
  50-15  extend the services or facilities.
  50-16        Sec. 49.216.  ENFORCEMENT BY PEACE OFFICERS.  (a)  A district
  50-17  may contract for or employ its own peace officers with power to
  50-18  make arrests when necessary to prevent or abate the commission of:
  50-19              (1)  any offense against the rules of the district when
  50-20  the offense or threatened offense occurs on any land, water, or
  50-21  easement owned or controlled by the district;
  50-22              (2)  any offense involving injury or detriment to any
  50-23  property owned or controlled by the district; and
  50-24              (3)  any offense against the laws of the state.
  50-25        (b)  A district may appoint reserve peace officers who may be
   51-1  called to serve as peace officers by the district during the actual
   51-2  discharge of their official duties.
   51-3        (c)  A reserve peace officer serves at the discretion of the
   51-4  district and may be called into service if the district considers
   51-5  it necessary to have additional officers to preserve the peace in
   51-6  or enforce the law of the district.
   51-7        (d)  A reserve peace officer on active duty and actively
   51-8  engaged in assigned duties has the same rights, privileges, and
   51-9  duties as any other peace officer of the district.
  51-10        (e)  Any peace officer, before beginning to perform any
  51-11  duties and at the time of appointment, must take an oath and
  51-12  execute a bond conditioned on faithful performance of such
  51-13  officer's duties in the amount of $1,000 payable to the district.
  51-14  The oath and the bond shall be filed in the district office.
  51-15        Sec. 49.217.  OPERATION OF CERTAIN MOTOR VEHICLES ON OR NEAR
  51-16  PUBLIC FACILITIES.  (a)  In this section, "motor vehicle" means a
  51-17  self-propelled device in, upon, or by which a person or property is
  51-18  or may be transported or drawn on a road or highway.
  51-19        (b)  Except as provided in Subsections (c) and (d), a person
  51-20  may not operate a motor vehicle on a levee, in a drainage ditch, or
  51-21  on land adjacent to a levee, canal, ditch, exposed conduit,
  51-22  pipeline, pumping plant, storm water facility, or other facility
  51-23  for the transmission, storage, treatment, or distribution of water,
  51-24  sewage, or storm water owned or controlled by a district.
  51-25        (c)  A district may authorize the use of motor vehicles on
   52-1  land that it owns or controls by posting signs on the property.
   52-2        (d)  This section does not prohibit a person from:
   52-3              (1)  driving on a public road or highway; or
   52-4              (2)  operating a motor vehicle used for repair or
   52-5  maintenance of public water, sewer, or storm water facilities.
   52-6        (e)  A person who operates a motor vehicle in violation of
   52-7  Subsection (b) commits an offense.  An offense under this section
   52-8  is a Class C misdemeanor, except that if a person has been
   52-9  convicted of an offense under this section, a subsequent offense is
  52-10  a Class B misdemeanor.
  52-11        Sec. 49.218.  ACQUISITION OF PROPERTY.  (a)  A district or a
  52-12  water supply corporation may acquire land, materials, waste
  52-13  grounds, easements, rights-of-way, equipment, contract or permit
  52-14  rights or interests and other property, real or personal,
  52-15  considered necessary for the purpose of accomplishing any one or
  52-16  more of the district's or water supply corporation's purposes
  52-17  provided in this code or in any other law.
  52-18        (b)  A district or water supply corporation shall have the
  52-19  right to acquire property by gift, grant, or purchase and the right
  52-20  to acquire property shall include property considered necessary for
  52-21  the construction, improvement, extension, enlargement, operation,
  52-22  or maintenance of the plants, works, improvements, facilities,
  52-23  equipment, or appliances of a district or a water supply
  52-24  corporation.
  52-25        (c)  A district or water supply corporation may acquire
   53-1  either the fee simple title to or an easement on all land, both
   53-2  public and private, either inside or outside its boundaries and may
   53-3  acquire the title to or an easement on property other than land
   53-4  held in fee.
   53-5        (d)  A district or water supply corporation may also lease
   53-6  property from others for its use on such terms and conditions as
   53-7  the board of the district or the board of directors of the water
   53-8  supply corporation may determine to be advantageous.
   53-9        Sec. 49.219.  ACQUISITION OF EXISTING FACILITIES.  Any
  53-10  district may acquire by agreement all or any part of existing
  53-11  water, sanitary sewer, or drainage systems of any water supply
  53-12  corporation, including works, improvements, facilities, plants,
  53-13  equipment, appliances, contract rights, and other assets and rights
  53-14  that are completed, partially completed, or under construction, and
  53-15  in connection therewith a district may assume all or any part of
  53-16  the contracts, indebtedness, or obligations of the corporation
  53-17  related to said systems, including any contracts, indebtedness, or
  53-18  obligations related to or payable from the revenues of said
  53-19  systems, and may perform all or any part of the obligations of said
  53-20  corporation in the same manner and to the same extent that any
  53-21  other purchaser or assignee could be bound on any such contracts,
  53-22  indebtedness, or obligations.  Before assuming any indebtedness or
  53-23  obligations of such corporation related to any such system, a
  53-24  district other than a river authority shall obtain the approval of
  53-25  the commission of such assumption.
   54-1        Sec. 49.220.  RIGHT TO USE EXISTING RIGHTS-OF-WAY.  All
   54-2  districts or water supply corporations are given rights-of-way,
   54-3  within, along, under, and across all public, state, county, city,
   54-4  town, or village roads, highways, and rights-of-way and other
   54-5  public rights-of-way without the requirement for surety bond or
   54-6  security.
   54-7        Sec. 49.221.  RIGHT TO ENTER LAND.  (a)  The directors,
   54-8  engineers, attorneys, agents, operators, and employees of a
   54-9  district or water supply corporation may go on any land to inspect,
  54-10  make surveys, or perform tests to determine the condition, value,
  54-11  and usability of the property, with reference to the proposed
  54-12  location of works, improvements, plants, facilities, equipment, or
  54-13  appliances.  The cost of restoration shall be borne by the district
  54-14  or the water supply corporation.
  54-15        (b)  District employees and agents are entitled to enter any
  54-16  public or private property within the boundaries of the district or
  54-17  adjacent to any reservoir or other property owned by the district
  54-18  at any reasonable time for the purpose of inspecting and
  54-19  investigating conditions relating to the quality of water in the
  54-20  state or the compliance with any rule, regulation, permit, or other
  54-21  order of the district.  District employees or agents acting under
  54-22  this authority who enter private property shall observe the
  54-23  establishment's rules and regulations concerning safety, internal
  54-24  security, and fire protection and shall notify any occupant or
  54-25  management of their presence and shall exhibit proper credentials.
   55-1        Sec. 49.222.  EMINENT DOMAIN.  (a)  A district or water
   55-2  supply corporation may acquire by condemnation any land, easements,
   55-3  or other property inside or outside the district boundaries, or the
   55-4  boundaries of the certificated service area for a water supply
   55-5  corporation, necessary for water, sanitary sewer, storm drainage,
   55-6  or flood drainage or control purposes or for any other of its
   55-7  projects or purposes, and may elect to condemn either the fee
   55-8  simple title or a lesser property interest.
   55-9        (b)  The right of eminent domain shall be exercised in the
  55-10  manner provided in Chapter 21, Property Code, except that a
  55-11  district or a water supply corporation shall not be required to
  55-12  give bond for appeal or bond for costs in any condemnation suit or
  55-13  other suit to which it is a party and shall not be required to
  55-14  deposit more than the amount of any award in any suit.
  55-15        (c)  The power of eminent domain may not be used for the
  55-16  condemnation of land for the purpose of acquiring rights to
  55-17  underground water or of water or water rights.
  55-18        Sec. 49.223.  COSTS OF RELOCATION OF PROPERTY.  (a)  In the
  55-19  event that the district or the water supply corporation, in the
  55-20  exercise of the power of eminent domain or power of relocation, or
  55-21  any other power, makes necessary the relocation, raising, lowering,
  55-22  rerouting, or change in grade of or alteration in construction of
  55-23  any road, bridge, highway, railroad, electric transmission line,
  55-24  telegraph, or telephone properties, facilities, or pipelines, all
  55-25  necessary relocations, raising, lowering, rerouting, or change in
   56-1  grade or alteration of construction shall be done at the sole
   56-2  expense of the district or the water supply corporation unless
   56-3  otherwise agreed to in writing.  Such relocation shall be
   56-4  accomplished in a timely manner so that the project of the district
   56-5  or the water supply corporation is not delayed.
   56-6        (b)  "Sole expense" means the actual cost of the relocation,
   56-7  raising, lowering, rerouting, or change in grade or alteration of
   56-8  construction and providing comparable replacement without enhancing
   56-9  the facilities after deducting from it the net salvage value
  56-10  derived from the old facility.
  56-11        Sec. 49.224.  POWER TO CONDEMN CEMETERIES.  (a)  The use of
  56-12  land for the construction of district dams and creation of lakes
  56-13  and reservoirs for the purpose of conservation and development of
  56-14  the natural resources of this state is hereby declared to be
  56-15  superior to all other uses; and for these purposes only a district
  56-16  has the power of eminent domain to acquire land, improvements, and
  56-17  other property owned and held for cemeteries or burial places
  56-18  necessary for the construction of a dam or that lies inside the
  56-19  area to be covered by the lake or reservoir or within 300 feet of
  56-20  the high water line of the lake or reservoir.
  56-21        (b)  Except as otherwise provided by this subchapter, the
  56-22  procedure in condemnation proceedings is governed by Chapter 21,
  56-23  Property Code.
  56-24        (c)  Notice shall be served on the title owner of the land on
  56-25  which the cemetery is situated as provided in Chapter 21, Property
   57-1  Code.  General notice to persons having relatives interred in the
   57-2  cemetery shall be given by publication for two consecutive weeks in
   57-3  a newspaper circulated in the county in which the cemetery is
   57-4  situated.
   57-5        (d)  The measure of damages in these eminent domain
   57-6  proceedings shall be assessed as in other condemnation cases.  An
   57-7  additional amount of damages shall be assessed to cover the cost of
   57-8  removing and reinterring the bodies interred in the cemetery or
   57-9  burial place and the cost of removing and resetting the monuments
  57-10  or markers erected at the graves.
  57-11        (e)  The additional assessment shall be deposited in the
  57-12  registry of the county court and disbursed only for the purpose of
  57-13  removing and reinterring the bodies in other cemeteries in Texas
  57-14  agreed on between the district and the relatives of the deceased
  57-15  persons.
  57-16        (f)  If in any case the district and the relatives of a
  57-17  deceased person cannot agree within 30 days on a cemetery for
  57-18  reinterment, or no relatives appear within that time, then the
  57-19  county judge shall designate the cemetery for reinterment.
  57-20        (g)  Instead of depositing the additional assessment in the
  57-21  registry of the court, the district may execute a bond sufficient
  57-22  to cover costs of removing and reinterring the bodies.  The bond
  57-23  shall be payable to and approved by the county judge and
  57-24  conditioned that the bodies will be removed and reinterred as
  57-25  provided by this section.
   58-1        Sec. 49.225.  LEASES.  A district may lease any of its
   58-2  property, real or personal, to any person.  The lease may contain
   58-3  the terms and provisions that the board determines to be
   58-4  advantageous to the district.
   58-5        Sec. 49.226.  SALE OR EXCHANGE OF SURPLUS LAND OR PERSONAL
   58-6  PROPERTY.  (a)  Any land, interest in land, or personal property
   58-7  owned by the district which is found by the board to be surplus and
   58-8  is not needed by the district may be sold under order of the board
   58-9  either by public or private sale, or the land, interest in land, or
  58-10  personal property may be exchanged for other land, interest in
  58-11  land, or personal property needed by the district.  Except as
  58-12  provided in Subsection (b), land, interest in land, or personal
  58-13  property must be exchanged for like fair market value, which value
  58-14  may be determined by the district.
  58-15        (b)  Any property dedicated to or acquired by the district
  58-16  without expending district funds may be abandoned or released to
  58-17  the original grantor, the grantor's heirs, assigns, executors, or
  58-18  successors upon terms and conditions deemed necessary or
  58-19  advantageous to the district and without receiving compensation for
  58-20  such abandonment or release.  District property may also be
  58-21  abandoned, released, exchanged or transferred to another district,
  58-22  municipality, county, county wide agency, or authority upon terms
  58-23  and conditions deemed necessary or advantageous to the district.
  58-24  Narrow strips of property resulting from boundary or surveying
  58-25  conflicts or similar causes, or from insubstantial encroachments by
   59-1  abutting property owners, may be abandoned, released, exchanged or
   59-2  transferred to such abutting owners upon terms and conditions
   59-3  deemed necessary or advantageous to the district.  Chapter 272,
   59-4  Local Government Code, shall not apply to this subsection.
   59-5        (c)  Before either a public or a private sale of real
   59-6  property not required by the district, the district shall give
   59-7  notice of the intent to sell by publishing notice once a week for
   59-8  two consecutive weeks in one or more newspapers with general
   59-9  circulation in the district.
  59-10        (d)  If the district has outstanding bonds secured by a
  59-11  pledge of tax revenues, the proceeds of the sale of property not
  59-12  required by the district shall be applied to retire outstanding
  59-13  bonds of the district when required by the district's applicable
  59-14  bond resolutions.
  59-15        (e)  If the district does not have any outstanding bonds, the
  59-16  proceeds derived from the sale of the personal property or land not
  59-17  required by the district may be used for any lawful purpose.
  59-18        Sec. 49.227.  AUTHORITY TO ACT JOINTLY.  A district or water
  59-19  supply corporation may act jointly with any other person or entity,
  59-20  private or public, whether within the State of Texas or the United
  59-21  States, in the performance of any of the powers and duties
  59-22  permitted by this code or any other laws.
  59-23        Sec. 49.228.  DAMAGE TO PROPERTY.  A person who wilfully
  59-24  destroys, defaces, damages or interferes with district or water
  59-25  supply corporation property is guilty of a Class B misdemeanor.
   60-1        Sec. 49.229.  GRANTS AND GIFTS.  A district may accept
   60-2  grants, gratuities, advances, and loans in any form from any source
   60-3  approved by the board, including any governmental entity, any
   60-4  private or public corporation, and any other person and may make
   60-5  and enter into contracts, agreements, and covenants the board
   60-6  considers appropriate in connection with acceptance of grants,
   60-7  gratuities, advances, and loans.
   60-8        Sec. 49.230.  AREA-WIDE WASTEWATER TREATMENT.  The powers and
   60-9  duties conferred on the district are granted subject to the policy
  60-10  of the state to encourage the development and use of integrated
  60-11  area-wide wastewater collection, treatment, and disposal systems to
  60-12  serve the wastewater disposal needs of the citizens of the state
  60-13  whenever economically feasible and competitive to do so, it being
  60-14  an objective of the policy to avoid the economic burden to the
  60-15  people and the impact on the quality of the water in the state that
  60-16  result from the construction and operation of numerous small
  60-17  wastewater collection, treatment, and disposal facilities to serve
  60-18  an area when an integrated area-wide wastewater collection,
  60-19  treatment, and disposal system for the area can be reasonably
  60-20  provided.
  60-21        Sec. 49.231.  STANDBY FEES.  (a)  In this section:
  60-22              (1)  "Standby fee" means a charge, other than a tax,
  60-23  imposed on undeveloped property for the availability of potable
  60-24  water, sanitary sewer, or drainage facilities and services.
  60-25              (2)  "Undeveloped property" means a tract, lot, or
   61-1  reserve in the district to which no potable water, sanitary sewer,
   61-2  or drainage connections have been made for which:
   61-3                    (A)  water, sanitary sewer, or drainage
   61-4  facilities and services are available;
   61-5                    (B)  water supply, wastewater treatment plant
   61-6  capacity, or drainage capacity sufficient to serve the property is
   61-7  available; or
   61-8                    (C)  major water supply lines, wastewater
   61-9  collection lines, or drainage facilities with capacity sufficient
  61-10  to serve the property are available.
  61-11        (b)  A district that proposes to provide or actually provides
  61-12  retail potable water or sewer utility services, or drainage
  61-13  services as the principal function of the district, may, with the
  61-14  approval of the commission, adopt and impose on the owners of
  61-15  undeveloped property in the district a standby fee in addition to
  61-16  taxes levied by the district.  A district may not impose a standby
  61-17  fee for debt service purposes on undeveloped property unless the
  61-18  facilities and services available to the property have been
  61-19  financed by the district; however, a district may impose a standby
  61-20  fee for operating and maintaining facilities that it has not
  61-21  financed.  The district may impose standby fees in different
  61-22  amounts to fairly reflect the level and type of services and
  61-23  facilities available to serve different property.  The intent of
  61-24  the standby fee is to distribute a fair portion of the cost burden
  61-25  for operating and maintaining the facilities and for financing
   62-1  capital costs of the facilities to owners of property who have not
   62-2  constructed improvements but have potable water, sewer, or drainage
   62-3  capacity available.  Any revenues collected from the standby fees
   62-4  shall be used to pay operation and maintenance expenses, to pay
   62-5  debt service on the bonds, or both.
   62-6        (c)  If the board described in Subsection (b) desires to
   62-7  adopt and impose a standby fee, the board shall submit to the
   62-8  commission an application for authority to adopt and impose the
   62-9  standby fee.  The application must describe the tracts of
  62-10  undeveloped property in the district and state the amount of the
  62-11  proposed fee.
  62-12        (d)  The executive director shall examine an application
  62-13  submitted under subsection (c) and shall investigate the financial
  62-14  condition of the district, including the district's assets,
  62-15  liabilities, sources of revenue, level of utility service rates,
  62-16  and level of debt service and maintenance tax rates.  On the
  62-17  request of the executive director, the district shall submit any
  62-18  information the executive director considers relevant to the
  62-19  examination and investigation.  The executive director shall
  62-20  prepare a written report on the application and the district's
  62-21  financial condition, retain a copy of the report, and send a copy
  62-22  of the report to the commission and the district.
  62-23        (e)  The commission shall hold a hearing on an application
  62-24  submitted under subsection (c).  Notice of the hearing shall be
  62-25  published in a newspaper of general circulation in the county or
   63-1  counties in which the district is located once a week for two
   63-2  consecutive weeks.  The first publication must occur not later than
   63-3  the 30th day before the date of the hearing.  The district shall
   63-4  send, not later than the 30th day before the date of the hearing,
   63-5  notice of the hearing by certified mail, return receipt requested,
   63-6  to each owner of undeveloped property in the district.  On the date
   63-7  the application is filed, the district's tax assessor and collector
   63-8  shall certify to the district the names of the persons owning
   63-9  undeveloped land in the district as reflected by the most recent
  63-10  certified tax roll of the district.  Notice of the hearing must be
  63-11  sent by certified mail, return receipt requested, to each mortgagee
  63-12  of record that has submitted a written request to be informed of
  63-13  any hearings.  To be effective, the written request must be
  63-14  received by the district not later than the 60th day before the
  63-15  date of the hearing.  The written request for notice must include
  63-16  the name and address of the mortgagee, the name of the property
  63-17  owner in the district, and a brief property description.
  63-18        (f)  The commission shall consider the application, the
  63-19  report of the executive director, and any other evidence allowed by
  63-20  commission rule.  The commission may approve the application only
  63-21  if the commission finds that the fee is necessary to maintain the
  63-22  financial integrity and stability of the district and fairly
  63-23  allocates the costs of district facilities and services among
  63-24  property owners of the district.
  63-25        (g)  After a hearing on an application under subsection (e),
   64-1  the commission shall issue an order approving or disapproving the
   64-2  application.  The commission shall retain a copy of the order and
   64-3  send a copy of the order to the district.
   64-4        (h)  The commission may approve the adoption and imposition
   64-5  of the standby fee for a period of not more than three years.  The
   64-6  imposition of a standby fee may be renewed for additional periods
   64-7  of not more than three years each in the same manner provided in
   64-8  this section for initial approval of the standby fee.
   64-9        (i)  If approved by the commission, the board by resolution
  64-10  or order may impose an annual standby fee on undeveloped land in
  64-11  the district.
  64-12        (j)  The board may:
  64-13              (1)  charge interest, at the rate of one percent a
  64-14  month, on a standby fee not paid in a timely manner in accordance
  64-15  with the resolution or order imposing the standby fee; and
  64-16              (2)  refuse to provide potable water, sanitary sewer,
  64-17  or drainage service to the property for which the fee was assessed
  64-18  until all delinquent standby fees on the property and interest on
  64-19  those fees are fully paid.
  64-20        (k)  A standby fee imposed under this section is a personal
  64-21  obligation of the person owning the undeveloped property on
  64-22  January 1 of the year for which the fee is assessed.  A person is
  64-23  not relieved of the obligation on transfer of title to the
  64-24  property.  On January 1 of each year, a lien attaches to
  64-25  undeveloped property to secure payment of any standby fee imposed
   65-1  under this section and the interest, if any, on the fee.  The lien
   65-2  has the same priority as a lien for taxes of the district.
   65-3        (l)  If a standby fee imposed under this section is not paid
   65-4  in a timely manner, a district may file suit to foreclose the lien
   65-5  securing payment of the fee and interest or to enforce the personal
   65-6  obligation for the fee and interest, or both.  The district may
   65-7  recover, in addition to the fee and interest, reasonable costs,
   65-8  including attorney's fees, incurred by the district in enforcing
   65-9  the lien or obligation not to exceed 20 percent of the delinquent
  65-10  fee and interest.  A suit authorized by this subsection must be
  65-11  filed not later than the fourth anniversary of the date the fee
  65-12  became due.  A fee delinquent for more than four years and interest
  65-13  on the fee are considered paid unless a suit is filed before the
  65-14  expiration of the four-year period.
  65-15        (m)  Chapter 395, Local Government Code, does not apply to a
  65-16  standby fee imposed under this section.
  65-17        (n)  For purposes of title insurance policies issued under
  65-18  the authority of Chapter 9, Insurance Code, standby fees are
  65-19  considered taxes.
  65-20            (Sections 49.232-49.270 reserved for expansion
  65-21                 SUBCHAPTER I.  CONSTRUCTION CONTRACTS
  65-22        Sec. 49.271.  CONTRACTS FOR CONSTRUCTION WORK.  (a)  Any
  65-23  contract made by the board for construction work shall conform to
  65-24  the provisions of this chapter.
  65-25        (b)  The contract shall contain, incorporate by reference, or
   66-1  have attached to it, the specifications, plans, and details for
   66-2  work included in the contract.  All work shall be done in
   66-3  accordance with these plans and specifications and any authorized
   66-4  change orders under the supervision of the board or its designee.
   66-5        (c)  The district may adopt minimum criteria for the
   66-6  qualifications of bidders on its construction contracts and for
   66-7  sureties issuing payment and performance bonds.  For contracts over
   66-8  $25,000, the district shall require a person who bids to submit a
   66-9  certified or cashier's check on a responsible bank in the state
  66-10  equal to at least two percent of the total amount of the bid as a
  66-11  good faith deposit to ensure execution of the contract.  The
  66-12  district may also require attendance by a principal of each
  66-13  prospective bidder at mandatory pre-bid conferences and may make
  66-14  any reasonable additional requirements regarding the taking of bids
  66-15  the district may deem appropriate in order to obtain competitive
  66-16  bids from responsible contractors and to minimize contract
  66-17  disputes.
  66-18        Sec. 49.272.  REPORTS FURNISHED TO PROSPECTIVE BIDDERS.  The
  66-19  board shall furnish to any person who desires to bid on
  66-20  construction work, and who makes a request in writing, a copy of
  66-21  the engineer's report or plans and specifications showing the
  66-22  details of the work to be done.  The board may charge for each copy
  66-23  of the engineer's report or plans and specifications an amount
  66-24  sufficient to cover the cost of making the copy.
  66-25        Sec. 49.273.  CONSTRUCTION CONTRACT AWARD.  (a)  The board
   67-1  shall contract for construction in accordance with this section.
   67-2  The bidding documents, plans, specifications and other data needed
   67-3  to bid on the project must be available at the time of the first
   67-4  advertisement and the advertisement shall state the location at
   67-5  which these documents may be reviewed.
   67-6        (b)  A construction contract may cover all the work to be
   67-7  provided by the district or the various elements of the work may be
   67-8  segregated for the purpose of receiving bids and awarding
   67-9  contracts.  A contract may provide that the work will be
  67-10  constructed in stages over a period of years.
  67-11        (c)  A construction contract may provide for the payment of a
  67-12  total sum that is the completed cost of the work or may be based on
  67-13  bids to cover cost of units of the various elements entering into
  67-14  the work as estimated and approximately specified by the district's
  67-15  engineers, or a contract may be let and awarded in any other form
  67-16  or composite of forms and to any responsible person or persons
  67-17  that, in the board's judgment, will be most advantageous to the
  67-18  district and result in the best and most economical completion of
  67-19  the district's proposed plants, improvements, facilities, works,
  67-20  equipment, and appliances.
  67-21        (d)  For construction contracts for $25,000 or more, the
  67-22  board shall advertise the letting of the contract, including the
  67-23  general conditions, time, and place of opening of sealed bids.  The
  67-24  notice shall be published in one or more newspapers circulated in
  67-25  each county in which part of the district is located.  If one
   68-1  newspaper meets both of these requirements, publication in such
   68-2  newspaper is sufficient.  If there are more than four counties in
   68-3  the district, notice may be published in any newspaper with general
   68-4  circulation in the district.  The notice shall be published once a
   68-5  week for three consecutive weeks before the date that the bids are
   68-6  opened, and the first publication shall be not later than the 21st
   68-7  day before the date of the opening of the sealed bids.
   68-8        (e)  For construction contracts for $15,000 or more but less
   68-9  than $25,000, the board shall solicit written competitive bids on
  68-10  uniform written specifications from at least three bidders.
  68-11        (f)  For construction contracts of less than $15,000, the
  68-12  board is not required to advertise or seek competitive bids.
  68-13        (g)  The board may not subdivide work to avoid the
  68-14  advertising requirements specified in this section.
  68-15        (h)  The board may not accept bids that include substituted
  68-16  items unless the substituted items were included in the original
  68-17  bid proposal and all bidders had the opportunity to bid on the
  68-18  substituted items; or if notice is given to all bidders at a
  68-19  mandatory pre-bid conference.
  68-20        (i)  Change orders to contracts may be issued only as a
  68-21  result of unanticipated conditions encountered during construction
  68-22  or changes in regulatory criteria or to facilitate project
  68-23  coordination with other political entities.
  68-24        (j)  The provisions of this subchapter do not apply to
  68-25  contracts for personal or professional services or for a utility
   69-1  service operator or to contracts made by a district engaged in the
   69-2  distribution and sale of electric energy to the public.
   69-3        (k)  The provisions of this subchapter do not apply to high
   69-4  technology procurements.  The provisions of Sections 252.021(a) and
   69-5  252.042, Local Government Code, shall apply to high technology
   69-6  procurements.
   69-7        Sec. 49.274.  EMERGENCY APPROVAL OF DISTRICT PROJECTS.  If a
   69-8  district experiences an emergency condition that may create a
   69-9  serious health hazard or unreasonable economic loss to the district
  69-10  that requires immediate corrective action, the district may
  69-11  negotiate limited duration contracts to make the necessary repairs.
  69-12  The district shall submit to the executive director details
  69-13  describing the specific serious health hazard or unreasonable
  69-14  economic loss as soon as practicable following the issuance of the
  69-15  contracts.  Whenever possible, the district should obtain prior
  69-16  approval of the executive director before authorizing the contract,
  69-17  but failure to obtain prior approval shall not void the contract.
  69-18  This section does not apply to river authorities.
  69-19        Sec. 49.275.  CONTRACTOR'S BOND.  Any person, firm,
  69-20  partnership, or corporation to whom a contract is let must give
  69-21  good and sufficient performance and payment bonds in accordance
  69-22  with Article 5160, Revised Statutes, and any minimum criteria for
  69-23  sureties issuing such bonds adopted by a district in accordance
  69-24  with Section 49.271.
  69-25        Sec. 49.276.  PAYMENT FOR CONSTRUCTION WORK.  (a)  The
   70-1  district shall pay the contract price of construction contracts
   70-2  only as provided in this section.
   70-3        (b)  The district will make progress payments under
   70-4  construction contracts monthly as the work proceeds, or at more
   70-5  frequent intervals as determined by the board or its designee, on
   70-6  estimates approved by the board or its designee.
   70-7        (c)  If requested by the district or district engineer, the
   70-8  contractor shall furnish a breakdown of the total contract price
   70-9  showing the amount included for each principal category of the
  70-10  work, in such detail as requested, to provide a basis for
  70-11  determining progress payments.  In the preparation of estimates,
  70-12  the district engineer may authorize material delivered on the site
  70-13  and preparatory work done to be considered if the consideration is
  70-14  specifically authorized by the contract and if the contractor
  70-15  furnishes satisfactory evidence that he has acquired title to the
  70-16  material and that it will be utilized on the work covered by the
  70-17  contract.
  70-18        (d)  In making progress payments, 10 percent of the estimated
  70-19  amount shall be retained until final completion and acceptance of
  70-20  the contract work.  However, if the board at any time after 50
  70-21  percent of the work has been completed finds that satisfactory
  70-22  progress is being made, it may authorize any of the remaining
  70-23  progress payments to be made in full.  Also, if the work is
  70-24  substantially complete, the board, if it finds the amount retained
  70-25  to be in excess of the amount adequate for the protection of the
   71-1  district, at its discretion may release to the contractor all or a
   71-2  portion of the excess amount.  The district is not obligated to pay
   71-3  interest on amounts retained except as provided herein.  The
   71-4  district shall not be obligated to pay any interest on the 10
   71-5  percent retainage held on the first 50 percent of work completed.
   71-6  If the district holds any retainage on the remaining 50 percent of
   71-7  the work completed, the district shall pay interest on such
   71-8  retainage from the date the retainage is withheld to the date of
   71-9  payment to the contractor.  The interest rate to be paid on such
  71-10  retainage shall be the rate of interest paid by the district's
  71-11  depository bank on interest bearing accounts of similar amounts
  71-12  during the period of time interest accrues as provided herein.
  71-13        (e)  On completion and acceptance of each separate project,
  71-14  public work, or other division of the contract, on which the price
  71-15  is stated separately in the contract, payment may be made without
  71-16  retention of a percentage.
  71-17        Sec. 49.277.  INSPECTION OF AND REPORTS ON CONSTRUCTION WORK.
  71-18  (a)  The board shall have control of construction work being done
  71-19  for the district under contract to determine whether or not the
  71-20  contract is being fulfilled and shall have the construction work
  71-21  inspected by the district engineer or other designated person.
  71-22        (b)  During the progress of the construction work, the
  71-23  district engineer or other designated person shall submit to the
  71-24  board detailed written reports showing whether or not the
  71-25  contractor is complying with the contract, and when the work is
   72-1  completed the district engineer shall submit to the board a final
   72-2  detailed report including as-built plans of the facilities showing
   72-3  whether or not the contractor has fully complied with the contract.
   72-4            (Sections 49.278-49.300 reserved for expansion
   72-5            SUBCHAPTER J.  ANNEXATION OR EXCLUSION OF LAND
   72-6        Sec. 49.301.  ADDING LAND BY PETITION OF LANDOWNER.  (a)  In
   72-7  addition to any other provision provided by law, the owner or
   72-8  owners of land whether or not contiguous to the district or
   72-9  otherwise may file with the board a petition requesting that there
  72-10  be included in the district the land described in the petition by
  72-11  metes and bounds or by lot and block number if there is a recorded
  72-12  plat of the area to be included in the district.  The petition may
  72-13  request the district to condition the annexation on certain
  72-14  conditions, including the voter authorization of bonds to serve the
  72-15  area to be annexed.
  72-16        (b)  If the district has bonds, notes, or other obligations
  72-17  outstanding or bonds payable in whole or in part from taxes that
  72-18  have been voted but are unissued, the board may require the
  72-19  petitioner or petitioners to assume their share of the outstanding
  72-20  bonds, notes, or other obligations and the voted but unissued tax
  72-21  bonds of the district and authorize the board to levy a tax on
  72-22  their property in each year while any of the bonds, notes, or other
  72-23  obligations payable in whole or in part from taxation are
  72-24  outstanding to pay their share of the indebtedness.
  72-25        (c)  The petition of the landowner to add land to the
   73-1  district shall be signed and executed in the manner provided by law
   73-2  for the conveyance of real estate.
   73-3        (d)  The board shall hear and consider the petition and may
   73-4  add to the district the land described in the petition if it is
   73-5  feasible, practicable, and to the advantage of the district and if
   73-6  the district's system and other improvements of the district are
   73-7  sufficient or will be sufficient to supply the added land without
   73-8  injuring land already in the district.
   73-9        (e)  If the district has bonds payable in whole or in part
  73-10  from taxation that are voted but unissued at the time of an
  73-11  annexation and the petitioners assume the bonds and authorize the
  73-12  district to levy a tax on their property to pay the bonds, then the
  73-13  board may issue the voted but unissued bonds even though the
  73-14  boundaries of the district have been altered since the
  73-15  authorization of the bonds.
  73-16        (f)  Granted petitions shall be filed for record and shall be
  73-17  recorded in the office of the county clerk of the county or
  73-18  counties in which the added land is located.
  73-19        Sec. 49.302.  ADDING LAND BY PETITION OF LESS THAN ALL THE
  73-20  LANDOWNERS.  (a)  In addition to the method of adding land to a
  73-21  district described in Section 49.301 of this subchapter, defined
  73-22  areas of land, whether or not they are contiguous to the district,
  73-23  may be annexed to the district in the manner set forth in this
  73-24  section.
  73-25        (b)  A petition requesting the annexation of a defined area
   74-1  signed by a majority in value of the owners of land in the defined
   74-2  area, as shown by the tax rolls of the county or counties in which
   74-3  such area is located, or signed by 50 landowners if the number of
   74-4  landowners is more than 50, shall describe the land by metes and
   74-5  bounds or by lot and block number if there is a recorded plat of
   74-6  the area and shall be filed with the secretary of the board.
   74-7        (c)  It shall be the duty of the board to pass an order
   74-8  fixing a time and place at which the petition for annexation shall
   74-9  be heard, which shall not be less than 30 days from the day of the
  74-10  order calling the hearing.
  74-11        (d)  The secretary of the board shall issue a notice setting
  74-12  forth the time and place of the hearing and describing the area
  74-13  proposed to be annexed.  Notice of the hearing shall be given by
  74-14  posting copies of the notice in three public places in the district
  74-15  and in one public place in the area proposed to be annexed for at
  74-16  least 14 days before the day of the hearing and by publishing a
  74-17  copy of the notice in a newspaper of general circulation in the
  74-18  county or counties in which the area proposed to be annexed is
  74-19  located one time at least 14 days before the day of the hearing.
  74-20        (e)  If upon the hearing of the petition it is found by the
  74-21  board that the proposed annexation of the area to the district is
  74-22  feasible, practicable, and to the advantage of the district and if
  74-23  the district's system and other improvements of the district are
  74-24  sufficient or will be sufficient to supply the added land without
  74-25  injuring land already in the district, then the board, by order
   75-1  entered in its minutes, may receive the proposed area as an
   75-2  addition to and to become a part of the district.  The order adding
   75-3  the proposed territory to the district need not include all of the
   75-4  land described in the petition if at the hearing a modification or
   75-5  change is found necessary or desirable by the board.
   75-6        (f)  A copy of the order annexing land to the district,
   75-7  signed by a majority of the members of the board and attested by
   75-8  the secretary of the board, shall be filed and recorded in the deed
   75-9  records of the county or counties in which the district is located
  75-10  if the land is finally annexed to the district.
  75-11        (g)  After the order is recorded the area shall be a
  75-12  component part of the district.
  75-13        (h)  The annexed area shall bear its pro rata share of all
  75-14  bonds, notes, or other obligations or taxes that may be owed,
  75-15  contracted, or authorized by the district to which it has been
  75-16  added.
  75-17        (i)  Before the added area shall be subject to all or any
  75-18  part of the bonds, notes, obligations, or taxes, created before the
  75-19  annexation of the area to the district, the board shall order an
  75-20  election to be held in the district, as enlarged by reason of the
  75-21  annexation of the area, on the question of the assumption of the
  75-22  bonds, notes, obligations, and taxes by the annexed area.
  75-23        (j)  At the same election, the board may also submit a
  75-24  proposition on the question of whether the annexed area should
  75-25  assume its part of the bonds of the district payable in whole or in
   76-1  part from taxes that have been voted previously but not yet issued
   76-2  or sold and the levy of an ad valorem tax on all taxable property
   76-3  within the area annexed along with a tax on the rest of the
   76-4  district for the payment of the bonds.
   76-5        (k)  If the election results favorably, the district shall be
   76-6  authorized to issue its voted but unissued tax bonds even though
   76-7  the boundaries of the district have been changed since the original
   76-8  election approving the bonds.
   76-9        (l)  At the election called for the purpose of determining
  76-10  whether the annexed area shall assume the bonds, notes, or other
  76-11  obligations or taxes of the district, the board in a separate
  76-12  proposition may also submit the question of whether the board
  76-13  should be authorized to issue bonds payable in whole or in part
  76-14  from taxes to provide service to the area annexed.
  76-15        (m)  In the event that the district has bonds, notes, or
  76-16  obligations or taxes that may be owed, contracted, or authorized at
  76-17  the time an area is annexed or if the district has voted but
  76-18  unissued bonds payable in whole or in part from taxes at the time
  76-19  of an annexation, the board may provide in its order annexing an
  76-20  area to the district that the annexation will not be complete or
  76-21  final unless the indebtedness, tax or bond, note, or other
  76-22  obligation assumption elections result favorably to the assumption
  76-23  of the district's outstanding bonds, notes, or other obligations
  76-24  and voted but unissued bonds.
  76-25        (n)  If the board elects to submit the question of whether
   77-1  the board should be authorized to issue bonds to provide service to
   77-2  the area annexed, the board may also provide in its order annexing
   77-3  an area to the district that the annexation will not be complete
   77-4  unless the election results favorably to the issuance of bonds to
   77-5  serve the annexed area.
   77-6        (o)  Whenever an election is ordered to be held in the
   77-7  district for the purpose of the assumption of bonds, notes, or
   77-8  other obligations or taxes or the assumption of voted but unissued
   77-9  bonds by reason of the annexation of any area, then the election
  77-10  shall be held and notice given as provided for bond elections held
  77-11  by the district.
  77-12        (p)  The district has the same right and duty to furnish
  77-13  service to the annexed land that it previously had to furnish
  77-14  service to other land in the district and the board shall endeavor
  77-15  to serve all land in the district without discrimination.
  77-16        Sec. 49.303.  EXCLUDING LAND FROM DISTRICT.  (a)  Before a
  77-17  district orders an election for the authorization of bonds payable
  77-18  in whole or in part from taxes, the board may, on its own motion,
  77-19  call a hearing on the question of the exclusion of land from the
  77-20  district under the provisions of Sections 49.303-49.307 of this
  77-21  subchapter, if the exclusions are practicable, just, or desirable.
  77-22        (b)  The board must call a hearing on the exclusion of land
  77-23  or other property from the district on the written petition of any
  77-24  landowner or property owner in the district filed with the
  77-25  secretary of the board before the first election on the question of
   78-1  whether bonds should be issued payable in whole or in part from
   78-2  taxes is ordered.
   78-3        (c)  The board may hold a hearing on the exclusion of land or
   78-4  other property from the district if the district has not issued
   78-5  bonds payable in whole or in part from taxes, and if a landowner or
   78-6  property owner submits a signed petition to the secretary of the
   78-7  board evidencing the consent of the owners of a majority of the
   78-8  acreage proposed to be excluded and a majority of the taxable
   78-9  property in the district, as reflected by the most recent certified
  78-10  tax roll of the district.
  78-11        (d)  A district that has previously held an election at which
  78-12  approval was given for the issuance of bonds payable in whole or in
  78-13  part from taxes may not rely on that election for the issuance of
  78-14  the bonds if after the bond election, but before the bonds are
  78-15  issued, land is excluded from the district as provided by this
  78-16  subchapter.  The board must call and hold another bond election and
  78-17  receive voter approval as provided by this subchapter before
  78-18  issuing those bonds.
  78-19        Sec. 49.304.  HEARING TO ANNOUNCE PROPOSED EXCLUSIONS AND TO
  78-20  RECEIVE PETITIONS.  (a)  If the board determines that an exclusion
  78-21  hearing should be held or if a written petition requesting an
  78-22  exclusion hearing is filed with the secretary of the board as
  78-23  provided in Section 49.303 of this subchapter, the board shall give
  78-24  notice of a time and place of a hearing to announce its own
  78-25  conclusions relating to land or other property to be excluded and
   79-1  to receive petitions for exclusion of land or other property.
   79-2        (b)  The board shall publish notice of the hearing once a
   79-3  week for two consecutive weeks in one or more newspapers with
   79-4  general circulation in the district.  The first publication shall
   79-5  appear at least 14 days before the day of the hearing.
   79-6        (c)  The notice shall advise all interested property owners
   79-7  of their right to present petitions for exclusions of land or other
   79-8  property and to offer evidence in support of the petitions and
   79-9  their right to contest any proposed exclusion based on either a
  79-10  petition or the board's own conclusions and to offer evidence in
  79-11  support of the contest.
  79-12        Sec. 49.305.  PETITION.  (a)  A petition for exclusion of
  79-13  land must accurately describe by metes and bounds or lot and block
  79-14  number the land to be excluded.  A petition for exclusion of other
  79-15  property must describe the property to be excluded.
  79-16        (b)  A petition for exclusion shall be filed with the
  79-17  district at least seven days before the hearing and shall state
  79-18  clearly the particular grounds on which the exclusion is sought.
  79-19  Only the stated grounds shall be considered.
  79-20        Sec. 49.306.  GROUNDS FOR EXCLUSION.  Exclusions from the
  79-21  district may be made on the grounds that:
  79-22              (1)  to retain certain land or other property within
  79-23  the district's taxing power would be arbitrary and unnecessary to
  79-24  conserve the public welfare, would impair or destroy the value of
  79-25  the property desired to be excluded, and would constitute the
   80-1  arbitrary imposition of a confiscatory burden;
   80-2              (2)  to retain any given land or other property in the
   80-3  district and to extend to it, either presently or in the future,
   80-4  the benefits, service, or protection of the district's facilities
   80-5  would create an undue and uneconomical burden on the remainder of
   80-6  the district; or
   80-7              (3)  the land desired to be excluded cannot be bettered
   80-8  as to conditions of living and health, or provided with water or
   80-9  sewer service or protected from flood, or drained, or freed from
  80-10  interruption of traffic caused by excess of water on the roads,
  80-11  highways, or other means of transportation serving the land, or
  80-12  otherwise benefited by the district's proposed improvements.
  80-13        Sec. 49.307.  HEARING AND ORDER EXCLUDING LAND.  (a)  The
  80-14  board may adjourn the hearing from one day to another and until all
  80-15  persons desiring to be heard are heard.  The board immediately
  80-16  shall specifically describe all property it proposes to exclude on
  80-17  its own motion and shall hear first any protests and evidence
  80-18  against exclusions proposed on the board's own motion.
  80-19        (b)  After considering all engineering data and other
  80-20  evidence presented to it, the board shall determine whether the
  80-21  facts disclose the affirmative of the propositions stated in
  80-22  Subdivision (1) or (2) or, if appropriate, in Subdivision (3) of
  80-23  Section 49.306 of this subchapter.  If the affirmative exists, the
  80-24  board shall enter an order excluding all land or other property
  80-25  falling within the conditions defined by the respective
   81-1  subdivisions and shall redefine in the order the boundaries of the
   81-2  district to embrace all land not excluded.  A copy of the order
   81-3  excluding land and redefining the boundaries of the district shall
   81-4  be filed in the deed records of the county or counties in which the
   81-5  district is situated.
   81-6        Sec. 49.308.  SUIT TO REVIEW EXCLUSION.  (a)  Any person
   81-7  owning an interest in land affected by the order may file a
   81-8  petition within 20 days after the effective date of the order to
   81-9  review, set aside, modify, or suspend the order.
  81-10        (b)  The venue in any action shall be in any district court
  81-11  that has jurisdiction in the county in which the district is
  81-12  located.  If the district includes land in more than one county,
  81-13  the venue shall be in the district court having jurisdiction in the
  81-14  county in which the major portion of the acreage of the land sought
  81-15  to be excluded from the district is located.
  81-16        (c)  A person may appeal from the judgment or order of a
  81-17  district court in a suit brought under the provisions of this
  81-18  section to the court of civil appeals and supreme court as in other
  81-19  civil cases in which the district court has original jurisdiction.
  81-20  The appeal is subject to the statutes and rules of practice and
  81-21  procedure in civil cases.
  81-22        Sec. 49.309.  EXCLUSION OF NONIRRIGATED PROPERTY.  For the
  81-23  purposes of Sections 49.309-49.314, the following definitions shall
  81-24  apply:
  81-25              (1)  "Nonirrigated property" means:
   82-1                    (A)  land that:
   82-2                          (i)  is not irrigable;
   82-3                          (ii)  the owners of a majority of the
   82-4  acreage of which no longer intend to irrigate; or
   82-5                          (iii)  has been subdivided into:
   82-6  (a)  town lots, or town lots and blocks, or small parcels of the
   82-7  same general nature of town lots; or
   82-8  (b)  town blocks and lots designed, intended, or suitable for
   82-9  residential, commercial, or other nonagricultural purposes, as
  82-10  distinguished from farm acreage whether subdivided into a
  82-11  subdivision or not; and
  82-12  (c)  including streets, alleys, parkways, parks, and railroad
  82-13  property and rights-of-way located in the subdivided land.
  82-14        The property described in Subdivision (1) shall be considered
  82-15  nonirrigated property regardless of whether the land is within or
  82-16  near a municipality and regardless of whether a plat or map of the
  82-17  subdivision has been duly filed for record and recorded in the
  82-18  office of the county clerk of the county in which the land or any
  82-19  part of the land is situated.
  82-20        The term does not include land that within the year preceding
  82-21  the date of the hearing under Section 49.310 was used for farming
  82-22  or agricultural purposes.
  82-23              (2)  "District" means a water control and improvement,
  82-24  water improvement, or irrigation district, the principal purpose of
  82-25  which is furnishing water for the irrigation of agricultural lands
   83-1  or that is principally engaged in furnishing water for the
   83-2  irrigation  of agricultural lands.
   83-3        Sec. 49.310.  AUTHORITY TO EXCLUDE LAND.  (a)  A petition for
   83-4  exclusion may be filed by the owner or owners, or their authorized
   83-5  agent, of a majority in acreage of nonirrigated property included
   83-6  within the boundaries of a district.
   83-7        (b)  Upon receipt of a petition for exclusion, or upon its
   83-8  own motion, a district shall issue an order excluding the property
   83-9  if, after notice and hearing, the board finds that:
  83-10              (1)  the described property is nonirrigated property;
  83-11              (2)  the applicable requirements of Section 49.311 have
  83-12  been satisfied;
  83-13              (3)  the owner or owners do not object to the exclusion
  83-14  of their nonirrigated property; and
  83-15              (4)  it is in the best interest of the district and of
  83-16  the described property to exclude that property from the district.
  83-17        (c)  The district shall follow the notice and hearing
  83-18  provisions and other procedural requirements for excluding
  83-19  territory applicable to that district as set out in Sections
  83-20  49.303-49.307.
  83-21        Sec. 49.311.  CONSENT FROM HOLDERS OF INDEBTEDNESS.  If the
  83-22  district has outstanding bonded indebtedness, or indebtedness under
  83-23  a loan from a governmental agency, a written consent from an
  83-24  authorized representative of the holder or holders of the
  83-25  indebtedness consenting to the exclusion shall be obtained and
   84-1  filed with the district before the hearing.
   84-2        Sec. 49.312.  RESULTS OF EXCLUSION.  (a)  Upon issuance of an
   84-3  order excluding property, that property is no longer a part of the
   84-4  district and is not entitled to water service from the district.
   84-5        (b)  Any taxes, assessments, or other charges owed to the
   84-6  district at the time of exclusion remain the obligation of the
   84-7  owner of the excluded property and continue to be secured by
   84-8  statutory liens on the property, if any.
   84-9        (c)  Once excluded, the landowner has no further liability to
  84-10  the district for future taxes, assessments, or other charges of the
  84-11  district.
  84-12        (d)  A copy of the order excluding the property from the
  84-13  district certified and acknowledged by the secretary of the board
  84-14  shall be recorded by the district in the real property records of
  84-15  the county in which the excluded property is located as evidence of
  84-16  the exclusion.
  84-17        Sec. 49.313.  DISTRICT FACILITIES ON EXCLUDED PROPERTY.  If
  84-18  any canals, ditches, pipelines, pumps, or other facilities of the
  84-19  district are located on lands excluded by the resolution of the
  84-20  board, the exclusion does not affect or interfere with any rights
  84-21  that the district has to maintain and continue operation of the
  84-22  facilities as located for the purpose of servicing lands remaining
  84-23  in the district.
  84-24        Sec. 49.314.  WATER ALLOCATIONS.  (a)  After the district
  84-25  adopts an order excluding nonirrigated property, a city or other
   85-1  water supply corporation that serves the excluded land with a
   85-2  potable water supply may petition the district to apply to the
   85-3  commission to convert the proportionate irrigation water allocation
   85-4  of the land excluded as nonirrigated property, as determined by the
   85-5  district, from irrigation use to municipal use allocation.
   85-6        (b)  The district shall make such application to the
   85-7  commission within thirty (30) days of the filing of a petition by
   85-8  the city or water supply corporation that serves the land with a
   85-9  potable water supply, provided the city or other water supply
  85-10  corporation pays the district the amount the district estimates
  85-11  will be its reasonable expenses and attorney's fees incurred in the
  85-12  commission conversion proceedings and enters into an agreement with
  85-13  the district setting forth the basis on which the water allocation
  85-14  shall be delivered, or made available, to the city or water supply
  85-15  corporation covering such terms as the entities may agree to, and
  85-16  in the event the parties cannot agree, such dispute shall not be
  85-17  subject to the jurisdiction of the commission, or its successors,
  85-18  under this code, but subject to resolution through alternative
  85-19  dispute resolution.  In such commission proceeding, the city or
  85-20  water supply corporation shall provide evidence to the commission
  85-21  of the current or projected need within a five (5) year period for
  85-22  the municipal-use water allocation after such conversion as a
  85-23  condition of such conversion of use of the district's water rights
  85-24  from irrigation use to municipal use.
  85-25            (Sections 49.315-49.320 reserved for expansion
   86-1                      SUBCHAPTER K.  DISSOLUTION
   86-2        Sec. 49.321.  DISSOLUTION AUTHORITY.  After notice and
   86-3  hearing, the commission may dissolve any district that is inactive
   86-4  for a period of five consecutive years and has no outstanding
   86-5  bonded indebtedness.
   86-6        Sec. 49.322.  NOTICE OF HEARING.  (a)  The commission shall
   86-7  give notice of the dissolution hearing that briefly describes the
   86-8  reasons for the proceeding.
   86-9        (b)  The notice shall be published once each week for two
  86-10  consecutive weeks before the day of hearing in some newspaper
  86-11  having general circulation in the county or counties in which the
  86-12  district is located.  The first publication shall be 30 days before
  86-13  the day of the hearing.
  86-14        (c)  The commission shall give notice of the hearing by first
  86-15  class mail addressed to the directors of the district according to
  86-16  the last record on file with the executive director.
  86-17        Sec. 49.323.  INVESTIGATION.  The executive director shall
  86-18  investigate the facts and circumstances of the district to be
  86-19  dissolved and the result of the investigation shall be included in
  86-20  a written report.
  86-21        Sec. 49.324.  ORDER OF DISSOLUTION.  The commission may enter
  86-22  an order dissolving the district at the conclusion of the hearing
  86-23  if it finds that the district has performed none of the functions
  86-24  for which it was created for a period of five consecutive years
  86-25  before the day of the proceeding and that the district has no
   87-1  outstanding bonded indebtedness.
   87-2        Sec. 49.325.  CERTIFIED COPY OF ORDER.  The commission shall
   87-3  file a certified copy of the order of dissolution of the district
   87-4  in the deed records of the county or counties in which the district
   87-5  is located.  If the particular district was created by a special
   87-6  Act of the legislature, the commission shall file a certified copy
   87-7  of the order of dissolution with the secretary of state.
   87-8        Sec. 49.326.  APPEALS.  (a)  Appeals from a commission order
   87-9  dissolving a district shall be filed and heard in the district
  87-10  court of any of the counties in which the land is located.
  87-11        (b)  The trial on appeal shall be de novo and the substantial
  87-12  evidence rule shall not apply.
  87-13        Sec. 49.327.  ASSETS ESCHEAT TO STATE.  Upon the dissolution
  87-14  of a district by the commission, all assets of the district shall
  87-15  escheat to the State of Texas.  The assets shall be administered by
  87-16  the state treasurer and shall be disposed of in the manner provided
  87-17  by Chapter 72, Property Code.
  87-18            (Sections 49.328-49.350 reserved for expansion
  87-19                    SUBCHAPTER L.  FIRE DEPARTMENTS
  87-20        Sec. 49.351.  FIRE DEPARTMENTS.  (a)  A district providing
  87-21  potable water or sewer service to household users may establish,
  87-22  operate, and maintain a fire department to perform all
  87-23  fire-fighting activities within the district as provided in this
  87-24  subchapter and may issue, with voter approval, bonds for financing
  87-25  the establishment of the fire department including the construction
   88-1  and purchase of necessary buildings, facilities, and equipment and
   88-2  the provision of an adequate water supply.
   88-3        (b)  After approval of the district electors of a plan to
   88-4  operate or jointly operate a fire department, the district or
   88-5  districts shall provide an adequate system and water supply for
   88-6  fire-fighting purposes and may construct and purchase necessary
   88-7  buildings, facilities, and equipment and may employ all necessary
   88-8  personnel including supervisory personnel to operate the fire
   88-9  department.
  88-10        (c)  Bonds issued for establishment of the fire department
  88-11  shall be authorized and issued, and a district shall be authorized
  88-12  to levy a tax to pay the principal of and interest on such bonds,
  88-13  as provided by law for authorization and issuance of other bonds of
  88-14  the district.
  88-15        (d)  Two or more districts may contract to operate a joint
  88-16  fire department for their districts and shall include in the
  88-17  contract a system for joint administration and operation of the
  88-18  fire department, the extent of services to be provided, a method
  88-19  for funding the department from funds of each district, and any
  88-20  other terms and conditions the parties consider necessary.
  88-21        (e)  A district may contract with any other person to perform
  88-22  fire-fighting services within the district.
  88-23        (f)  Before a district establishes a fire department,
  88-24  contracts to operate a joint fire department, or contracts with
  88-25  another person to perform fire-fighting services within the
   89-1  district, the district must comply with the provisions of
   89-2  Subsections (g), (h), and (i).
   89-3        (g)  A district or districts proposing to act jointly shall
   89-4  develop a detailed plan for the establishment, operation, and
   89-5  maintenance of the proposed department, including a detailed
   89-6  presentation of all financial requirements.  If a district is
   89-7  entering into a contract under subsection (e), the district shall
   89-8  develop a plan that describes in detail the facilities and
   89-9  equipment to be devoted to service to the district and all
  89-10  proposals for providing the service and that includes a
  89-11  presentation of the financial requirements under the contract.
  89-12  Before adoption of a plan and any contract by the district, the
  89-13  board shall hold a hearing at which any person residing in the
  89-14  district may present testimony for and against the proposed plan
  89-15  and any proposed contract.  Notice of the hearing and the place at
  89-16  which the plan and any contract may be examined shall be posted in
  89-17  two public places within the district at least 10 days before the
  89-18  date of the hearing.
  89-19        (h)  After adoption of the plan and any contract by the
  89-20  board, the plan and financial presentation, together with any
  89-21  contract and a written report in a form prescribed by the executive
  89-22  director describing existing fire departments and fire-fighting
  89-23  services available within 25 miles of the boundaries of the
  89-24  district, shall be submitted to the executive director for
  89-25  consideration by the commission under rules adopted by the
   90-1  commission.  Before approval or disapproval, the commission shall
   90-2  hold a hearing.  Notice of the hearing before the commission shall
   90-3  be posted by the board in at least two public places in the
   90-4  district at least five days before the hearing.  Before the
   90-5  commission approves the application, it must find that it is
   90-6  economically feasible for the district to implement the plan and
   90-7  meet the provisions of any contract and shall take into
   90-8  consideration in giving its approval the general financial
   90-9  condition of the district and the economic feasibility of the
  90-10  district carrying out the plan or meeting the obligations of the
  90-11  contract.
  90-12        (i)  After approval by the commission, the district shall
  90-13  submit to the electors of the district at the election to approve
  90-14  bonds for financing the plan, or if no bonds are to be approved, at
  90-15  an election called for approval of the plan, the proposition of
  90-16  whether or not the plan should be implemented or entered into by
  90-17  the district.  The ballots at the election shall be printed, as
  90-18  applicable, to provide for voting for or against the proposition:
  90-19  "The implementation of the plan for (operation/joint operation) of
  90-20  a fire department"; or "The plan and contract to provide
  90-21  fire-fighting services for the district."
  90-22        (j)  No funds of the district may be used to establish a fire
  90-23  department, to enter into joint operation of a fire department, or
  90-24  to contract for fire-fighting services without the approval of a
  90-25  plan by the electors as provided in this section.  However, the
   91-1  district may use available funds for preparation of a plan and any
   91-2  contract.  The operation of a fire department or provision of
   91-3  fire-fighting services is an essential public necessity, and a
   91-4  district may discontinue any and all services, including water and
   91-5  sewer service, to any person who fails to timely pay fire
   91-6  department service fees or any other assessment adopted by the
   91-7  district to support the fire department or the provision of
   91-8  fire-fighting services.
   91-9               (Sections 49.352-49.450 reserved for expansion
  91-10            SUBCHAPTER M.  NOTICES, REPORTS, AND BANKRUPTCY
  91-11        Sec. 49.451.  POSTING SIGNS IN THE DISTRICT.  (a)  A district
  91-12  subject to the notice requirements of Section 49.452 shall, within
  91-13  30 days after the effective date of this section or the creation of
  91-14  the district, post signs indicating the existence of the district
  91-15  at two principal entrances to the district.
  91-16        (b)  The size and exact location of the information contained
  91-17  on the signs shall be determined by the executive director.
  91-18        Sec. 49.452.  NOTICE TO PURCHASERS.  (a)(1)  Any person who
  91-19  proposes to sell or convey real property located in a district
  91-20  created under this title or by a special Act of the legislature,
  91-21  which is providing or proposing to provide, as the district's
  91-22  principal function, water, sanitary sewer, drainage, and flood
  91-23  control or protection facilities or services, or any of these
  91-24  facilities or services that have been financed or are proposed to
  91-25  be financed with bonds of the district payable in whole or part
   92-1  from taxes of the district, or by imposition of a standby fee, if
   92-2  any, to household or commercial users, other than agricultural,
   92-3  irrigation, or industrial users, and which district includes less
   92-4  than all the territory in at least one county and which, if located
   92-5  within the corporate area of a city, includes less than 75 percent
   92-6  of the incorporated area of the city or which is located outside
   92-7  the corporate area of a city in whole or in substantial part, must
   92-8  first give to the purchaser the written notice provided in this
   92-9  section.
  92-10              (2)  The provisions of this section shall not be
  92-11  applicable to:
  92-12                    (A)  transfers of title under any type of lien
  92-13  foreclosure;
  92-14                    (B)  transfers of title by deed in cancellation
  92-15  of indebtedness secured by a lien upon the property conveyed; or
  92-16                    (C)  transfers of title by reason of a will or
  92-17  probate proceedings.
  92-18        (b)  The prescribed notice for all districts shall be
  92-19  executed by the seller and shall read as follows:
  92-20        "The real property, described below, that you are about to
  92-21  purchase is located in the ______________________ District.  The
  92-22  district has taxing authority separate from any other taxing
  92-23  authority, and may, subject to voter approval, issue an unlimited
  92-24  amount of bonds and levy an unlimited rate of tax in payment of
  92-25  such bonds.  As of this date, the rate of taxes levied by the
   93-1  district on real property located in the district is $____________
   93-2  on each $100 of assessed valuation.  If the district has not yet
   93-3  levied taxes, the most recent projected rate of debt service tax,
   93-4  as of this date, is $____________ on each $100 of assessed
   93-5  valuation.  The total amount of bonds approved by the voters and
   93-6  which have been or may, at this date, be issued is $____________,
   93-7  and the aggregate initial principal amounts of all bonds issued for
   93-8  one or more of the specified facilities of the district and payable
   93-9  in whole or in part from property taxes is $____________.
  93-10        "The district has the authority to adopt and impose a standby
  93-11  fee on property in the district that has water, sanitary sewer, or
  93-12  drainage facilities and services available but not connected and
  93-13  which does not have a house, building, or other improvement located
  93-14  thereon and does not substantially utilize the utility capacity
  93-15  available to the property.  The district may exercise the authority
  93-16  without holding an election on the matter.  As of this date, the
  93-17  most recent amount of the standby fee is $____________.  An unpaid
  93-18  standby fee is a personal obligation of the person that owned the
  93-19  property at the time of imposition and is secured by a lien on the
  93-20  property.  Any person may request a certificate from the district
  93-21  stating the amount, if any, of unpaid standby fees on a tract of
  93-22  property in the district.
  93-23        "The purpose of this district is to provide water, sewer,
  93-24  drainage, or flood control facilities and services within the
  93-25  district through the issuance of bonds payable in whole or in part
   94-1  from property taxes.  The cost of these utility facilities is not
   94-2  included in the purchase price of your property, and these utility
   94-3  facilities  are  owned  or  to be owned by the district.  The legal
   94-4  description of the property you are acquiring is as follows:
   94-5  ___________________________________________________________________
   94-6                                             __________________(Date)
   94-7                                             ________________________
   94-8                                                  Signature of Seller
   94-9        PURCHASER IS ADVISED THAT THE INFORMATION SHOWN ON THIS FORM
  94-10  IS SUBJECT TO CHANGE BY THE DISTRICT AT ANY TIME.  THE DISTRICT
  94-11  ROUTINELY ESTABLISHES TAX RATES DURING THE MONTHS OF SEPTEMBER
  94-12  THROUGH DECEMBER OF EACH YEAR, EFFECTIVE FOR THE YEAR IN WHICH THE
  94-13  TAX RATES ARE APPROVED BY THE DISTRICT.  PURCHASER IS ADVISED TO
  94-14  CONTACT THE DISTRICT TO DETERMINE THE STATUS OF ANY CURRENT OR
  94-15  PROPOSED CHANGES TO THE INFORMATION SHOWN ON THIS FORM.
  94-16        "The undersigned purchaser hereby acknowledges receipt of the
  94-17  foregoing notice at or prior to execution of a binding contract for
  94-18  the purchase of the real property described in such  notice  or  at
  94-19  closing of purchase of the real property.
  94-20                                             __________________(Date)
  94-21                                             ________________________
  94-22                                               Signature of Purchaser
  94-23        "(Note:  Correct district name, tax rate, bond amounts, and
  94-24  legal description are to be placed in the appropriate space.
  94-25  Except for notices included as an addendum or paragraph of a
   95-1  purchase contract, the notice shall be executed by the seller and
   95-2  purchaser, as indicated.  If the district does not propose to
   95-3  provide one or more of the specified facilities and services, the
   95-4  appropriate purpose may be eliminated.  If the district has not yet
   95-5  levied taxes, a statement of the district's most recent projected
   95-6  rate of debt service tax is to be placed in the appropriate space.
   95-7  If the district does not have approval from the commission to adopt
   95-8  and impose a standby fee, the second paragraph of the notice may be
   95-9  deleted.  For the purposes of the notice form required to be given
  95-10  to the prospective purchaser prior to execution of a binding
  95-11  contract of sale and purchase, a seller and any agent,
  95-12  representative, or person acting on the seller's behalf may modify
  95-13  the notice by substitution of the words 'January 1, ____________'
  95-14  for the words 'this date' and place the correct calendar year in
  95-15  the appropriate space."
  95-16        (c)  The notice required by this section shall be given to
  95-17  the prospective purchaser prior to execution of a binding contract
  95-18  of sale and purchase either separately or as an addendum or
  95-19  paragraph of a purchase contract.  In the event a contract of
  95-20  purchase and sale is entered into without the seller providing the
  95-21  notice required by this subsection, the purchaser shall be entitled
  95-22  to terminate the contract.  If, however, the seller furnishes the
  95-23  required notice at or prior to closing the purchase and sale
  95-24  contract and the purchaser elects to close even though such notice
  95-25  was not timely furnished prior to execution of the contract, it
   96-1  shall be conclusively presumed that the purchaser has waived all
   96-2  rights to terminate the contract and recover damages or other
   96-3  remedies or rights under the provisions of this section.
   96-4  Notwithstanding any provision of this subchapter to the contrary,
   96-5  all sellers, title companies, examining attorneys, and any agent,
   96-6  representative, or person acting on their behalf shall not be
   96-7  liable for damages under the provisions of either Subsection (l) or
   96-8  (m) or liable for any other damages to any person for failure to
   96-9  provide the notice required by this section to a purchaser prior to
  96-10  execution of a binding contract of a purchase and sale when the
  96-11  district has not filed the information form and map or plat as
  96-12  required under Section 49.455.
  96-13        (d)  The purchaser shall sign the notice or purchase contract
  96-14  including such notice to evidence the receipt of notice.
  96-15        (e)  At the closing of purchase and sale, a separate copy of
  96-16  such notice with current information shall be executed by the
  96-17  seller and purchaser, acknowledged, and thereafter recorded in the
  96-18  deed records of the county in which the property is located.  For
  96-19  the purposes of this section, all sellers, title companies, and
  96-20  examining attorneys, and any agent, representative, or person
  96-21  acting on their behalf, shall be entitled to rely on the accuracy
  96-22  of the information form and map or plat as last filed by each
  96-23  district under Section 49.455 or the information contained in or
  96-24  shown on the notice form issued by the district under Section
  96-25  49.453 in completing the notice form to be executed by the seller
   97-1  and purchaser at the closing of purchase and sale.  Any information
   97-2  taken from the information form or map or plat as last filed by
   97-3  each district and the information contained in or shown on the
   97-4  notice form issued by the district under Section 49.453 shall be,
   97-5  for purposes of this section, conclusively presumed as a matter of
   97-6  law to be correct.  All subsequent sellers, purchasers, title
   97-7  insurance companies, examining attorneys, and lienholders shall be
   97-8  entitled to rely upon the information form and map or plat filed by
   97-9  the district or the notice form issued by the district under
  97-10  Section 49.453.
  97-11        (f)  For the purposes of this section, an executory contract
  97-12  of purchase and sale having a performance period of more than six
  97-13  months shall be considered a sale under subsection (a).
  97-14        (g)  For the purposes of the notice form to be given to the
  97-15  prospective purchaser prior to execution of a binding contract of
  97-16  sale and purchase, a seller and any agent, representative, or
  97-17  person acting in the seller's behalf may modify the notice by
  97-18  substitution of the words "January 1, ____________" for the words
  97-19  "this date" and place the correct calendar year in the appropriate
  97-20  space.  All sellers, and all persons completing the prescribed
  97-21  notice in the sellers' behalf, shall be entitled to rely on the
  97-22  information contained in or shown on the information form and map
  97-23  or plat filed of record by the district under Section 49.455 in
  97-24  completing the prescribed form to be given to the prospective
  97-25  purchaser prior to execution of a binding contract of sale and
   98-1  purchase.  Except as otherwise provided in subsection (e), any
   98-2  information taken from the information form or map or plat filed of
   98-3  record by the district in effect as of January 1 of each year shall
   98-4  be, for purposes of the notice to be given to the prospective
   98-5  purchaser prior to execution of a binding contract of sale and
   98-6  purchase, conclusively presumed as a matter of law to be correct
   98-7  for the period January 1 through December 31 of such calendar year.
   98-8  A seller and any persons completing the prescribed notice in the
   98-9  seller's behalf may provide more recent information, if available,
  98-10  than the information contained in or shown on the information form
  98-11  and map or plat filed of record by the district under Section
  98-12  49.455 in effect as of January 1 of each year in completing the
  98-13  prescribed form to be given to the purchaser prior to execution of
  98-14  a binding contract of sale and purchase.  Nothing contained in the
  98-15  preceding sentence shall be construed to create an affirmative duty
  98-16  on the part of a seller or any persons completing the prescribed
  98-17  notice in the seller's behalf to provide more recent information
  98-18  than the information taken from the information form and map or
  98-19  plat filed of record by the district as of January 1 of each year
  98-20  in completing the prescribed notice to be given to the purchaser
  98-21  prior to execution of a binding contract of sale and purchase.  All
  98-22  subsequent sellers, purchasers, title insurance companies,
  98-23  examining attorneys, and lienholders shall be entitled to rely upon
  98-24  the information form and map or plat filed by the district.
  98-25        (h)  If such notice is given at closing as provided in
   99-1  Subsection (e), a purchaser, or the purchaser's heirs, successors,
   99-2  or assigns, shall not be entitled to maintain any action for
   99-3  damages or maintain any action against a seller, title insurance
   99-4  company, or lienholder, or any agent, representative, or person
   99-5  acting in their behalf, by reason of use by the seller of the
   99-6  information filed for record by the district or reliance by the
   99-7  seller on the filed plat and filed legal description of the
   99-8  district in determining whether the property to be sold and
   99-9  purchased is within the district.  No action may be maintained
  99-10  against any title company for failure to disclose the inclusion of
  99-11  the described real property within a district when the district has
  99-12  not filed for record the information form, map, or plat with the
  99-13  clerk of the county or counties in which the district is located.
  99-14        (i)  Any purchaser who purchases any real property in a
  99-15  district and who thereafter sells or conveys the same shall on
  99-16  closing of such subsequent sale be conclusively considered as
  99-17  having waived any prior right to damages under this section.
  99-18        (j)  It is the express intent of this section that all
  99-19  sellers, title insurance companies, examining attorneys, vendors of
  99-20  property and tax information, real estate brokers and lienholders,
  99-21  and any agent, representative, or person acting on their behalf,
  99-22  shall be entitled to rely on the accuracy of the information form
  99-23  and map or plat as last filed by each district or the information
  99-24  contained in or shown on the notice form issued by the district
  99-25  under Section 49.453, or for the purposes of the notice to be given
  100-1  the purchaser prior to execution of a binding contract of sale and
  100-2  purchase the information contained in or shown on the information
  100-3  form and map or plat filed of record by the district in effect as
  100-4  of January 1 of each year for the period January 1 through December
  100-5  31 of such calendar year.
  100-6        (k)  Except as otherwise provided in subsection (c), if any
  100-7  sale or conveyance of real property within a district is not made
  100-8  in compliance with the provisions of this section, the purchaser
  100-9  may institute a suit for damages under the provisions of either
 100-10  subsection (l) or (m).
 100-11        (l)  A purchaser of real property covered by the provisions
 100-12  of this section, if the sale or conveyance of the property is not
 100-13  made in compliance with this section, may institute a suit for
 100-14  damages in the amount of all costs relative to the purchase of the
 100-15  property plus interest and reasonable attorney's fees.  The suit
 100-16  for damages may be instituted jointly or severally against the
 100-17  person, firm, corporation, partnership, organization, business
 100-18  trust, estate, trust, association, or other legal entity that sold
 100-19  or conveyed the property to the purchaser.  Following the recovery
 100-20  of damages under this subsection, the amount of the damages shall
 100-21  first be paid to satisfy all unpaid obligations on each outstanding
 100-22  lien or liens on the property and the remainder of the damage
 100-23  amount shall be paid to the purchaser.  On payment of all damages
 100-24  respectively to the lienholders and purchaser, the purchaser shall
 100-25  reconvey the property to the seller.
  101-1        (m)  A purchaser of real property covered by the provisions
  101-2  of this section, if the sale or conveyance of the property is not
  101-3  made in compliance with this section, may institute a suit for
  101-4  damages in an amount not to exceed $5,000, plus reasonable
  101-5  attorney's fees.
  101-6        (n)  A purchaser is not entitled to recover damages under
  101-7  both Subsections (l) and (m), and entry of a final decision
  101-8  awarding damages to the purchaser under either Subsection (l) or
  101-9  (m) shall preclude the purchaser from recovering damages under the
 101-10  other subsection.  Notwithstanding any part or provision of the
 101-11  general or special laws or the common law of the state to the
 101-12  contrary, the relief provided under Subsections (l) and (m) shall
 101-13  be the exclusive remedies for a purchaser aggrieved by the seller's
 101-14  failure to comply with the provisions of this section.  Any action
 101-15  for damages shall not, however, apply to, affect, alter, or impair
 101-16  the validity of any existing vendor's lien, mechanic's lien, or
 101-17  deed of trust lien on the property.
 101-18        (o)  A suit for damages under the provisions of this section
 101-19  must be brought within 90 days after the purchaser receives the
 101-20  first district tax notice or within four years after the property
 101-21  is sold or conveyed to the purchaser, whichever time occurs first,
 101-22  or the purchaser loses the right to seek damages under this
 101-23  section.
 101-24        (p)  Notwithstanding any provisions of this subchapter to the
 101-25  contrary, a purchaser may not recover damages of any kind under
  102-1  this section if that person:
  102-2              (1)  purchases an equity in real property and in
  102-3  conjunction with the purchase assumes any liens, whether purchase
  102-4  money or otherwise; and
  102-5              (2)  does not require proof of title by abstract, title
  102-6  policy, or any other proof of title.
  102-7        Sec. 49.453.  NOTICE FORM FROM DISTRICT.  (a)  A district
  102-8  covered by Section 49.452 shall also maintain in the district
  102-9  office the particular form of Notice to Purchasers required by
 102-10  Section 49.452 to be furnished by a seller to a purchaser of real
 102-11  property in that district and shall, upon written request of any
 102-12  person, issue the notice form completed by a district with all
 102-13  information required to be furnished by the district.  A notice
 102-14  form issued by a district under the provisions of this section
 102-15  shall include a written statement that the notice form is being
 102-16  issued by the district, the date of its issuance, and the
 102-17  district's telephone number.  A district shall not be required to
 102-18  orally provide the information.
 102-19        (b)  A district may charge a reasonable fee as determined by
 102-20  the district not to exceed $10 for the issuance of a notice form
 102-21  pursuant to Subsection (a).  The notice form shall be delivered by
 102-22  regular mail or made available at the district's office.  If a
 102-23  district is requested to deliver the notice form to a person by an
 102-24  alternative method, the district may impose a charge not to exceed
 102-25  the actual cost of such delivery.
  103-1        (c)  A district may delegate the responsibility for issuance
  103-2  of the particular form of Notice to Purchasers to an employee or
  103-3  agent of the district.  A district shall file with the commission
  103-4  the name, address, and telephone number of the employee or agent of
  103-5  the district responsible for issuance of the notice forms and shall
  103-6  notify the commission in writing within seven days after there is a
  103-7  change to the information required to be filed with the commission
  103-8  under the provisions of this subsection.
  103-9        (d)  Any notice issued by the district shall contain the
 103-10  information effective as of the date of its issuance.
 103-11        Sec. 49.454.  NOTICE OF UNPAID STANDBY FEES.  (a)  A district
 103-12  covered by Section 49.452 shall, on the written request of any
 103-13  person, issue a certificate stating the amount of any unpaid
 103-14  standby fees, including interest on the fees, that have been
 103-15  assessed against a tract of property in the district.  The district
 103-16  may charge a fee not to exceed $10 for each certificate.  A
 103-17  certificate issued through fraud or collusion is void.
 103-18        (b)  If the district issues a certificate containing an
 103-19  erroneous statement under Subsection (a) and the owner of the
 103-20  property transfers the property to a good faith purchaser for
 103-21  value, the lien on the property provided by Section 49.231(k) is
 103-22  extinguished to the extent of the error.
 103-23        (c)  This section does not affect the liability for any
 103-24  unpaid standby fees of the former owner of the undeveloped property
 103-25  under Section 49.231(k).
  104-1        Sec. 49.455.  FILING INFORMATION.  (a)  The board covered by
  104-2  the provisions of Section 49.452 of this subchapter shall file with
  104-3  the county clerk in each of the counties in which all or part of
  104-4  the district is located a duly affirmed and acknowledged
  104-5  information form that includes the information required in
  104-6  subsection (b), and a complete and accurate map or plat showing the
  104-7  boundaries of the district.
  104-8        (b)  The information form filed by a district under this
  104-9  section shall include:
 104-10              (1)  the name of the district;
 104-11              (2)  the complete and accurate legal description of the
 104-12  boundaries of the district;
 104-13              (3)  the most recent rate of district taxes on property
 104-14  located in the district;
 104-15              (4)  the total amount of bonds that have been approved
 104-16  by the voters and which may be issued by the district (excluding
 104-17  refunding bonds and any bonds or portion of bonds payable solely
 104-18  from revenues received or expected to be received pursuant to a
 104-19  contract with a governmental entity);
 104-20              (5)  the aggregate initial principal amount of all
 104-21  bonds of the district payable in whole or part from taxes
 104-22  (excluding refunding bonds and any bonds or portion of bonds
 104-23  payable solely from revenues received or expected to be received
 104-24  pursuant to a contract with a governmental entity) that have been
 104-25  previously issued and remain outstanding;
  105-1              (6)  whether a standby fee is imposed by the district
  105-2  and, if so, the amount of the standby fee;
  105-3              (7)  the date on which the election to confirm the
  105-4  creation of the district was held if such was required;
  105-5              (8)  a statement of the functions performed or to be
  105-6  performed by the district; and
  105-7              (9)  the particular form of Notice to Purchasers
  105-8  required by Section 49.452 of this subchapter to be furnished by a
  105-9  seller to a purchaser of real property in that district completed
 105-10  by the district with all information required to be furnished by
 105-11  the district.
 105-12        If a district has not yet levied taxes, a statement to such
 105-13  effect together with the district's most recent projected rate of
 105-14  debt service tax shall be substituted for Subdivisions (3) and (4)
 105-15  of this subsection.
 105-16        (c)  The information form and map or plat required by this
 105-17  section shall be signed by a majority of the members of the board
 105-18  and by each such officer affirmed and acknowledged before it is
 105-19  filed with the county clerk, and each amendment made to an
 105-20  information form or map shall also be signed by the members of the
 105-21  board and by each such officer affirmed and acknowledged before it
 105-22  is filed with the county clerk.
 105-23        (d)  The information form required by this section shall be
 105-24  filed with the county clerk within 48 hours after the effective
 105-25  date of this section or within 48 hours after the district is
  106-1  officially created, whichever time comes first.  For purposes of
  106-2  this section, the words "officially created" mean the date and hour
  106-3  in which the results of the election to confirm the creation of the
  106-4  district are declared.
  106-5        (e)  Within seven days after there is a change in any of the
  106-6  information contained in the district information form or map or
  106-7  plat, the district shall file an amendment to the information form
  106-8  or map setting forth the changes made.
  106-9        (f)  Any person who affirms the corrections and accuracy of
 106-10  and acknowledges an information form, map, or plat, or any
 106-11  amendment to an information form or map or plat that includes
 106-12  information that is inaccurate or incorrect shall be guilty of a
 106-13  misdemeanor and shall be fined not less than $100 nor more than
 106-14  $1,000 for each violation.
 106-15        (g)  If a district fails to file the information required by
 106-16  this section in the time required, the executive director may
 106-17  request the state attorney general or the district or the county
 106-18  attorney of the county in which the district is located to seek a
 106-19  writ of mandamus to force the board to prepare and file the
 106-20  necessary information.
 106-21        (h)  Any member of a governing board who wilfully fails or
 106-22  refuses to join in filing an information form, map, plat, or
 106-23  amendment to an information form, map, or plat under this section
 106-24  shall be guilty of a misdemeanor and shall be fined not less than
 106-25  $100 nor more than $1,000 for each violation.  A member of a
  107-1  governing board is presumed to have wilfully failed or refused to
  107-2  join in the filing of an information form, map, plat, or amendment
  107-3  to an information form, map, or plat if that member was present at
  107-4  the meeting at which the information included in the information
  107-5  form, map, plat, or amendment to the information form, map, or plat
  107-6  was adopted.
  107-7        (i)  If a district covered by this section is dissolved,
  107-8  annexed to another local government, or is consolidated with
  107-9  another district, the members of the board shall file a statement
 107-10  of this fact together with the effective date of the dissolution,
 107-11  annexation, or consolidation with the information form.  After a
 107-12  district is dissolved and the statement is filed under this
 107-13  subsection, a person who sells or conveys property within the
 107-14  dissolved district is no longer required to give notice under
 107-15  Section 49.452 of this subchapter.
 107-16        (j)  A copy of all information forms, maps, plats, and
 107-17  amendments to these filed under this section shall also be filed
 107-18  with the executive director.
 107-19        Sec. 49.456.  BANKRUPTCY OF DISTRICTS; AUTHORITY OF
 107-20  COMMISSION.  (a)  Notwithstanding Section 1, Chapter 207, General
 107-21  Laws, Acts of the 44th Legislature, Regular Session, 1935 (Article
 107-22  1024a, Vernon's Texas Civil Statutes), Section 1, Chapter 1, page
 107-23  70, General Laws, Acts of the 46th Legislature, Regular Session,
 107-24  1939 (Article 1024b, Vernon's Texas Civil Statutes); or any other
 107-25  law of this state, a district created under Article III, Sections
  108-1  52(b)(1) and (2), or Article XVI, Section 59, of the Texas
  108-2  Constitution, that is subject to the continuing supervision of the
  108-3  commission, may not proceed under Chapter 9 of the Federal
  108-4  Bankruptcy Code (11 U.S.C. Sections 901-946) or any other law
  108-5  enacted by the Congress of the United States under federal
  108-6  bankruptcy authority until the commission authorizes the district
  108-7  to proceed under those laws by written order.
  108-8        (b)  A district requesting the commission's authorization to
  108-9  proceed under Chapter 9 of the Federal Bankruptcy Code (11 U.S.C.
 108-10  Sections 901-946) or any other federal bankruptcy law shall file an
 108-11  application with the commission requesting authorization.
 108-12        (c)  The commission shall investigate the financial condition
 108-13  of a district submitting an application under Subsection (b),
 108-14  including its assets, liabilities, and sources of revenues and may
 108-15  require a district to submit any information that the commission
 108-16  considers material to a determination of whether authorization to
 108-17  proceed in bankruptcy should be granted.
 108-18        (d)  The commission may not authorize a district to proceed
 108-19  in bankruptcy unless the commission determines that the district
 108-20  cannot, through the full exercise of its rights and powers under
 108-21  the laws of this state, reasonably expect to meet its debts and
 108-22  other obligations as they mature.
 108-23        (e)  The commission shall adopt and assess reasonable and
 108-24  necessary fees adequate to recover the costs of the commission in
 108-25  administering this section.
  109-1        SECTION 4.  Title 4, Water Code, is amended by adding Chapter
  109-2  59 to read as follows:
  109-3                    CHAPTER 59.  REGIONAL DISTRICTS
  109-4                   SUBCHAPTER A.  DISTRICT CREATION
  109-5        Sec. 59.001.  PURPOSE AND APPLICATION.  (a)  The purpose of
  109-6  this chapter is to authorize creation and operation of regional
  109-7  districts for water, sanitary sewer, drainage, and municipal solid
  109-8  waste disposal under Article XVI, Section 59, of the Texas
  109-9  Constitution.
 109-10        (b)  This chapter applies only in counties with a population
 109-11  of at least 2.2 million, according to the most recent federal
 109-12  census, or bordering a county with a population of at least 2.2
 109-13  million, according to the most recent federal census.
 109-14        Sec. 59.002.  DEFINITIONS.  (a)  In this chapter:
 109-15              (1)  "District" means a district created or operating
 109-16  under this chapter.
 109-17              (2)  "Municipal district" means a district created
 109-18  under general law or a special Act operating under Chapters 51, 53,
 109-19  or 54.
 109-20              (3)  "Bond" means bonds, coupons, notes, or any other
 109-21  evidence of indebtedness.
 109-22        (b)  Other terms not defined by this chapter have the same
 109-23  meaning assigned to those terms by Section 49.001.
 109-24        Sec. 59.003.  CREATION OF DISTRICT.  (a)  A district may be
 109-25  created by:
  110-1              (1)  The boards of at least 20 percent of the total
  110-2  number of municipal districts to be included in the proposed
  110-3  district may jointly petition the commission for creation of a
  110-4  district.  The petition must describe the territory to be included
  110-5  in the district and must include resolutions endorsing creation of
  110-6  the district adopted by each municipal district to be included in
  110-7  the district.
  110-8              (2)  The owner or owners of 2,000 or more contiguous
  110-9  acres may petition the commission for creation of a district.
 110-10              (3)  The commissioners courts of one or more counties
 110-11  may petition the commission for creation of a district in any
 110-12  territory within the county.
 110-13              (4)  The governing body of any city may petition the
 110-14  commission for creation of a district in any territory within the
 110-15  city or its extraterritorial jurisdiction.
 110-16        (b)  Petitions for the creation of a district must:
 110-17              (1)  describe the boundaries of the proposed district
 110-18  by metes and bounds that adequately and completely circumscribe the
 110-19  property so that there is complete closure of the property or by
 110-20  lot and block numbers if there is a recorded map or plat or
 110-21  subdivision survey of the area;
 110-22              (2)  state the general nature of the work proposed to
 110-23  be done, the necessity of the work, and the cost of any projects of
 110-24  the district as estimated by those filing the petition;
 110-25              (3)  state the name of each petitioner; and
  111-1              (4)  include a name of the district generally
  111-2  descriptive of the locale of the district followed by the words
  111-3  "Regional District."
  111-4        (c)  A proposed district may not have the same name as any
  111-5  other district in the state.
  111-6        (d)  Section 54.013 applies to the composition of districts
  111-7  created under this chapter.
  111-8        Sec. 59.004.  PURPOSES OF DISTRICT.  A district shall be
  111-9  created:
 111-10              (1)  to purchase, own, hold, lease, and otherwise
 111-11  acquire sources of water supply;
 111-12              (2)  to build, operate, and maintain facilities for the
 111-13  transportation of water;
 111-14              (3)  to sell water to cities, to political subdivisions
 111-15  of this state, to water supply corporations, to private business
 111-16  entities, and to individuals;
 111-17              (4)  to purchase, own, hold, lease, and otherwise
 111-18  acquire equipment and mechanisms necessary for sanitary sewer and
 111-19  wastewater treatment;
 111-20              (5)  to build, operate, and maintain facilities for
 111-21  sanitary sewer and wastewater treatment;
 111-22              (6)  to transport and treat sanitary sewer and
 111-23  wastewater effluent of cities and political subdivisions of this
 111-24  state, and for private business entities or individuals;
 111-25              (7)  to purchase, own, hold, lease, and otherwise
  112-1  acquire equipment and mechanisms for the drainage of storm water
  112-2  and floodwater; and
  112-3              (8)  for the purposes outlined in Section 54.012.
  112-4        Sec. 59.005.  MATCHING FUNDS GUARANTEES.  If the Texas Water
  112-5  Development Board requires that matching funds be provided as a
  112-6  condition for receiving a loan or grant from the Texas Water
  112-7  Development Board from research and planning funds, the matching
  112-8  funds may not be provided through a guarantee of matching funds by
  112-9  any individual who has a financial interest in the regional
 112-10  district or who will receive any direct financial benefit from a
 112-11  regional district project.
 112-12        Sec. 59.006.  CONSENT OF CITY.  (a)  Land in the corporate
 112-13  limits of a city or in the extraterritorial jurisdiction of a city
 112-14  may not be included in a district unless the city grants its
 112-15  written consent by resolution or ordinance to the inclusion of the
 112-16  land in the district.
 112-17        (b)  If the governing body of a city fails or refuses to
 112-18  grant permission for the inclusion of land in its extraterritorial
 112-19  jurisdiction in a district within 120 days after receipt of a
 112-20  written request, the person or entity desiring to create the
 112-21  district may petition the governing body of the city to make
 112-22  available the water, sewer, or drainage service contemplated to be
 112-23  provided by the district.
 112-24        (c)  Failure of the governing body of the city and the
 112-25  requesting district to execute a mutually agreeable contract
  113-1  providing for the service requested within six months after receipt
  113-2  of a request for consent constitutes authorization for the
  113-3  inclusion of land in the district under this section.
  113-4  Authorization for the inclusion of the land in the district under
  113-5  this section means only authorization to initiate proceedings to
  113-6  include the land in the district as otherwise provided by this
  113-7  chapter.
  113-8        (d)  Sections 54.016(e), (f), (g), and (h) apply under this
  113-9  chapter.
 113-10        Sec. 59.007.  GRANTING OR REFUSING PETITION; EXCLUSION OF
 113-11  TERRITORY.  (a)  If after the hearing of the petition the
 113-12  commission finds that the petition conforms to the requirements of
 113-13  this chapter and that the creation of the district would be of
 113-14  benefit to the territory to be included in the district, the
 113-15  commission shall issue an order granting the petition for creation.
 113-16  If the commission finds that part of the territory included in the
 113-17  proposed district will not benefit from the creation of the
 113-18  district, the commission shall exclude that territory from the
 113-19  proposed district and redefine the proposed district's boundaries
 113-20  accordingly.
 113-21        (b)  If the commission finds that the petition does not
 113-22  conform to the requirements of this chapter or that the proposed
 113-23  projects are not of benefit to the territory in the proposed
 113-24  district, the commission shall issue an order either denying the
 113-25  petition or requiring petitioners to amend their petition.
  114-1        (c)  A copy of the order of the commission granting or
  114-2  denying a petition shall be mailed to each city having
  114-3  extraterritorial jurisdiction in the county or counties in which
  114-4  the district is to be located that has requested notice of hearings
  114-5  as provided by Section 54.019.
  114-6            (Sections 59.008-59.020 reserved for expansion
  114-7               SUBCHAPTER B.  ADMINISTRATIVE PROVISIONS
  114-8        Sec. 59.021.  DIRECTORS.  (a)  The commission shall appoint
  114-9  temporary directors who shall serve until permanent directors are
 114-10  elected.
 114-11        (b)  A petition requesting creation filed in accordance with
 114-12  Section 59.006 may provide that directors be elected by precinct as
 114-13  provided by Subsection (h).
 114-14        (c)  The board of directors is composed of five members
 114-15  unless the petition requesting creation of the district requests
 114-16  and the commission approves a board that consists of seven members.
 114-17        (d)  Permanent directors shall be elected in accordance with
 114-18  Chapter 49.
 114-19        (e)  If the petition for creation has requested the election
 114-20  of seven directors as provided by Subsection (c), unless otherwise
 114-21  agreed, the three directors elected who received the fewest number
 114-22  of votes, whether their election is by precinct or at large, shall
 114-23  serve until the next directors' election following the confirmation
 114-24  election and the four who received the highest number of votes
 114-25  shall serve until the second directors' election after the
  115-1  confirmation election.
  115-2        (f)  After the creation of the district, the persons or
  115-3  entities that petitioned for creation or 50 qualified voters of the
  115-4  district may file a petition with the commission requesting to
  115-5  expand the district's board to seven members.  If the commission
  115-6  grants the petition, the commission shall appoint two temporary
  115-7  directors.  One temporary director shall serve until the next
  115-8  directors' election and one shall serve until the next succeeding
  115-9  directors' election.  At each election one director shall be
 115-10  elected to serve for a four-year term.
 115-11        (g)  If the board of directors of the district is expanded to
 115-12  seven members, four directors shall constitute a quorum and a
 115-13  concurrence of four directors is necessary in all matters
 115-14  pertaining to the business of the district.
 115-15        (h)  A petition for the creation of a district may request
 115-16  that the board be elected to represent a geographic area.  If the
 115-17  petition requesting creation of the district is granted, the
 115-18  commission shall establish precincts from which the directors are
 115-19  to be elected.  In establishing the precincts the commission shall
 115-20  attempt to have directors represent geographic areas with equal
 115-21  numbers of people and shall comply with the federal Voting Rights
 115-22  Act (42 U.S.C. Sections 1971, 1973 et seq.).  Thereafter, the board
 115-23  of directors of the district shall revise the precincts from time
 115-24  to time to cause them to comply with the provisions of this
 115-25  subsection.
  116-1        Sec. 59.022.  ABILITY TO SET RATES.  The district may charge
  116-2  rates to persons and entities located outside the district's
  116-3  boundaries on terms, rates, and charges the board of directors may
  116-4  determine to be advisable.  In setting rates for out-of-district
  116-5  customers, the board shall set rates sufficient to enable it to
  116-6  meet operation and maintenance expenses and to pay the principal of
  116-7  and interest on debt issued in connection with providing service
  116-8  and to provide a reasonable reserve for replacements to the
  116-9  district.  In setting rates, the district may take into
 116-10  consideration past operation and debt service expenses.
 116-11        Sec. 59.023.  ISSUANCE OF BONDS.  The district may issue
 116-12  bonds for the purpose of purchasing, constructing, acquiring,
 116-13  owning, operating, repairing, improving, or extending any district
 116-14  works, improvements, facilities, plants, equipment, and appliances
 116-15  needed to accomplish the purposes of the district, including works,
 116-16  improvements, facilities, plants, equipment, and appliances needed
 116-17  to provide a waterworks system, sanitary sewer system, storm sewer
 116-18  system, solid waste disposal system, and parks and recreational
 116-19  facilities.  Prior to issuing bonds or other obligations, a
 116-20  confirmation election must be held in accordance with Chapter 49,
 116-21  and a majority of voters must approve the establishment of the
 116-22  district.
 116-23        Sec. 59.024.  EXCLUSION OF CERTAIN MUNICIPAL DISTRICTS.
 116-24  (a)  A municipal district may be excluded from the district as
 116-25  provided by this section.
  117-1        (b)  To be excluded, the board of directors of the municipal
  117-2  district may adopt a resolution requesting exclusion by a majority
  117-3  vote of its board of directors and shall file the petition with the
  117-4  directors of the proposed district before the first confirmation
  117-5  election.
  117-6        (c)  At the time of the district's confirmation election, a
  117-7  separate voting precinct shall be used for the qualified voters in
  117-8  each municipal district that has filed a petition requesting
  117-9  exclusion.  The votes in each precinct shall be tallied separately
 117-10  to determine whether that municipal district will be excluded from
 117-11  the district boundaries.
 117-12        (d)  If a majority of the votes cast in a municipal district
 117-13  requesting exclusion vote against confirmation of the district, the
 117-14  votes cast in the confirmation election shall not be counted for
 117-15  the confirmation election, bond election, or maintenance tax
 117-16  election, and that municipal district must be excluded from the
 117-17  boundaries of the district by the board of directors of the
 117-18  district at the time the results of the election are canvassed.
 117-19        (e)  After a confirmation election at which the district is
 117-20  authorized to be created, the board of directors of the district
 117-21  shall adopt an order redefining the boundaries of the district to
 117-22  exclude those municipal districts petitioning for exclusion that
 117-23  have voted not to confirm creation of the district.
 117-24        (f)  Before the creation hearing, any municipal district
 117-25  located within the proposed district may petition the commission
  118-1  for a separate voting precinct to be used within the boundaries of
  118-2  the petitioning district at the time of the district's confirmation
  118-3  election.  If the commission grants the petition requesting a
  118-4  separate voting precinct, subsections (c) through (e) apply.
  118-5        Sec. 59.025.  CONFIRMATION ELECTION.  (a)  Before a district
  118-6  may be created pursuant to a petition granted by the commission, a
  118-7  confirmation election must be held within the boundaries of the
  118-8  proposed district.
  118-9        (b)  The directors appointed by the commission shall call and
 118-10  hold the confirmation election in the manner provided for
 118-11  conducting elections under Chapter 49.  The provisions of those
 118-12  sections relating to a director's election do not apply to an
 118-13  election held under this section.
 118-14        (c)  If the creation of the district is defeated, subsequent
 118-15  confirmation elections may not be held to confirm the creation of
 118-16  the district.
 118-17        (d)  A bond election, maintenance tax election, and any other
 118-18  election may be held at the same time and in conjunction with a
 118-19  confirmation election.
 118-20            (Sections 59.026-59.050 reserved for expansion
 118-21       SUBCHAPTER C.  ADDING OR EXCLUDING TERRITORY; DISSOLUTION
 118-22        Sec. 59.051.  ADDING LAND BY PETITION OF LESS THAN ALL
 118-23  LANDOWNERS.  In addition to the method of adding land to a district
 118-24  described in Section 59.052, defined areas of land, regardless of
 118-25  whether they are contiguous to the district, may be annexed to the
  119-1  district in the manner provided in Chapter 49.
  119-2        Sec. 59.052.  FILING OF PETITION.  A petition requesting the
  119-3  annexation of a defined area signed by a majority in value of the
  119-4  owners of land in the defined area, as shown by the tax rolls of
  119-5  the county or counties in which that area is located; signed by 50
  119-6  landowners if the number of landowners is more than 50; signed by
  119-7  the single landowner of 2,000 or more acres of land in the area; or
  119-8  signed by a majority of the governing body of a municipal district,
  119-9  a county, or a city requesting annexation, shall be filed with the
 119-10  secretary of the board.
 119-11        Sec. 59.053.  DISSOLUTION OF DISTRICT BEFORE ISSUANCE OF
 119-12  BONDS.  (a)  If the board considers it advisable before the
 119-13  issuance of any bonds, the board may dissolve the district and
 119-14  liquidate the affairs of the district as provided by Sections
 119-15  54.734 through 54.738.
 119-16        (b)  If a majority of the board finds at any time before the
 119-17  authorization of bonds that the proposed district and its proposed
 119-18  activities are for any reason impracticable or apparently cannot be
 119-19  successfully and beneficially accomplished, the board may issue
 119-20  notice of a hearing on a proposal to dissolve the district.
 119-21        Sec. 59.054.  JUDICIAL REVIEW OF BOARD'S ORDER.  The board's
 119-22  order to dissolve the district may be judicially reviewed as
 119-23  provided in Chapter 49.
 119-24            (Sections 59.055-59.070 reserved for expansion
 119-25                     SUBCHAPTER D.  MISCELLANEOUS
  120-1        Sec. 59.071.  ANNEXATION OR INCORPORATION BY CITY.  (a)  In
  120-2  this section, "district" has the meaning assigned by Section
  120-3  59.002(a)(1).
  120-4        (b)  If a city annexes all or any part of the territory
  120-5  within a district, or incorporates all or any part of any territory
  120-6  within a district, the city shall succeed to the powers, duties,
  120-7  assets, and obligations of the district as provided by this
  120-8  chapter.
  120-9        (c)  On annexation of any part of the territory of a district
 120-10  by a city or incorporation by a city of any part of the territory
 120-11  of a district, the city shall assume a pro rata share of all debt
 120-12  of the district payable in whole or in part by ad valorem taxes
 120-13  incurred for water, sewer, or drainage purposes or any combination
 120-14  of the three purposes.  The percentage of the assumption shall be
 120-15  determined by multiplying the total debt of the district payable in
 120-16  whole or in part from taxes incurred for the stated purposes by a
 120-17  fraction, the numerator of which is the assessed value of the
 120-18  property to be annexed or incorporated based on the most recent
 120-19  certified county property tax rolls at the time of annexation or
 120-20  incorporation and the denominator of which is the total assessed
 120-21  value of the property of the district based on the most recent
 120-22  certified county property tax rolls at the time of annexation or
 120-23  incorporation.
 120-24        (d)  After annexation by a city of a portion of the territory
 120-25  of a district or incorporation over any part of the territory of a
  121-1  district, the district may not levy taxes on that territory, and
  121-2  the territory is no longer considered a part of the district for
  121-3  any purpose.
  121-4        (e)  If any district's debt payable in whole or in part from
  121-5  ad valorem taxes is assumed by a city, the governing body of the
  121-6  city shall levy and cause to be collected taxes on all taxable
  121-7  property within the city or provide other funds sufficient to pay
  121-8  the city's pro rata share of the principal of and interest on that
  121-9  debt as it becomes due and payable.
 121-10        (f)  If a city annexes or incorporates the entire territory
 121-11  of the district, the district shall be dissolved in accordance with
 121-12  Sections 43.074, 43.075, and 43.081, Local Government Code, if the
 121-13  district is located in one city or Sections 43.076-43.079, Local
 121-14  Government Code, if the district is located in more than one city.
 121-15        (g)  Section 43.071, Local Government Code, does not apply to
 121-16  the annexation of a district created pursuant to this chapter.
 121-17        Sec. 59.072.  OTHER LAWS.  (a)  Except as specifically
 121-18  provided by this chapter, Sections 54.018, 54.019(a), (b), (c), and
 121-19  (d), 54.020, 54.021, 54.023, 54.024, 54.201, 54.205, 54.207 through
 121-20  54.209, 54.502 through 54.506, 54.507(b) and (c), 54.509 through
 121-21  54.512, 54.514, 54.515, 54.517, 54.518, 54.520, 54.521, 54.601
 121-22  through 54.604, and 54.735 through 54.737 apply under this chapter.
 121-23        (b)  Section 54.019(e) does not apply to a district governed
 121-24  by this chapter.
 121-25        SECTION 5.  Section 51.0711(a), Water Code, is amended to
  122-1  read as follows:
  122-2        (a)  The governing body of a municipality that enters a
  122-3  contract or agreement with a district located in more than one
  122-4  county to jointly construct, acquire, operate, or maintain a
  122-5  regional wastewater system is entitled to appoint a special
  122-6  director to the board of the district.  Section 51.072 <of this
  122-7  code> does not apply to a special director.
  122-8        SECTION 6.  Section 51.072, Water Code, is amended to read as
  122-9  follows:
 122-10        Sec. 51.072.  Qualifications for Director.  To be qualified
 122-11  for election as a director, a person must be a resident of the
 122-12  state, own land subject to taxation in the district, and be at
 122-13  least 18 <21> years of age.  Section 49.052 does not apply to a
 122-14  district governed by this chapter whose principal purpose is
 122-15  providing water for irrigation.
 122-16        SECTION 7.  Section 51.076(a), Water Code, is amended to read
 122-17  as follows:
 122-18        (a)  In a district created after June 18, 1967, with
 122-19  boundaries coterminous with the boundaries of a county, the
 122-20  commissioners court may provide in the order granting the petition
 122-21  for creation that the directors are to be selected either as
 122-22  provided in Section 49.102 <51.073 of this code> or by the
 122-23  "commissioners precinct method," which provides for the election of
 122-24  two directors from each commissioners precinct in the county and
 122-25  the election of one director from the county at large.
  123-1        SECTION 8.  Section 51.750(d), Water Code, is amended to read
  123-2  as follows:
  123-3        (d)  The temporary directors of each of the resulting
  123-4  districts must qualify as directors of the district pursuant to
  123-5  Section <Sections> 51.072 <and 51.073 of this code> within the
  123-6  period of 90 days after the election approving the division of the
  123-7  original district and shall assume their offices at the expiration
  123-8  of the 90-day period.
  123-9        SECTION 9.  Section 52.005, Water Code, is amended by adding
 123-10  Subsection (c) to read as follows:
 123-11        (c)  Section 49.052, Section 49.216, and Sections
 123-12  49.301-49.308 do not apply to districts governed by this chapter.
 123-13        SECTION 10.  Section 52.115, Water Code, is amended to read
 123-14  as follows:
 123-15        Sec. 52.115.  Meetings.  <(a)>  The board shall hold regular
 123-16  quarterly meetings.  It may hold meetings at other times as
 123-17  required for the business of the district.
 123-18        <(b)  Any person may attend a meeting of the board and may
 123-19  present in an orderly manner matters for the board's consideration.>
 123-20        <(c)  Meetings shall be conducted and notice of meetings
 123-21  shall be posted in accordance with the open meetings law, Chapter
 123-22  271, Acts of the 60th Legislature, Regular Session, 1967 (Article
 123-23  6252-17, Vernon's Texas Civil Statutes).>
 123-24        SECTION 11.  Sections 52.294(c), (d), and (e), Water Code,
 123-25  are amended to read as follows:
  124-1        (c)  <Notice of an election must be given as provided by
  124-2  Section 52.059(c) of this code for creation elections.>
  124-3        <(d)>  At an election to authorize bonds or notes payable
  124-4  wholly from ad valorem taxes, the ballots must be printed to
  124-5  provide for voting for or against the proposition:  "The issuance
  124-6  of (bonds or notes) and the levy of taxes for payment of the (bonds
  124-7  or notes)."  At any election to authorize bonds or notes payable
  124-8  from both ad valorem taxes and revenues, the ballots must be
  124-9  printed to provide for voting for or against:  "The issuance of
 124-10  (bonds or notes) and the pledge of net revenues and the levy of ad
 124-11  valorem taxes adequate to provide for the payment of the (bonds or
 124-12  notes)."
 124-13        (d) <(e)>  The board shall canvass the returns and declare
 124-14  the results of the election.  If a majority of the votes cast at
 124-15  the election favor the issuance of the bonds or notes, the bonds or
 124-16  notes may be issued by the board, but if a majority of the votes
 124-17  cast at the election do not favor issuance of the bonds or notes,
 124-18  the bonds or notes may not be issued.
 124-19        SECTION 12.  Section 53.040, Water Code, is amended to read
 124-20  as follows:
 124-21        Sec. 53.040.  Elected Supervisors Take Office.  If the
 124-22  election results in a division of the district, the five candidates
 124-23  receiving the most votes in each new district shall be declared
 124-24  elected.  They shall immediately qualify in accordance with Section
 124-25  49.055 <by taking the constitutional oath of office and shall file
  125-1  the oath with the county clerk>.
  125-2        SECTION 13.  Section 53.042, Water Code, is amended to read
  125-3  as follows:
  125-4        Sec. 53.042.  Newly Elected Supervisors--Term of Office.  The
  125-5  newly elected supervisors hold office until the new district's next
  125-6  supervisors election <first general election and then until their
  125-7  successors are elected and have qualified>.
  125-8        SECTION 14.  Section 53.062, Water Code, is amended to read
  125-9  as follows:
 125-10        Sec. 53.062.  Board of Supervisors.  A district created under
 125-11  this chapter is governed by a board of five elected supervisors.
 125-12  <Specific provisions for the election of supervisors are found in
 125-13  Section 53.021, Section 53.086, and Section 53.0861 of this code.>
 125-14        SECTION 15.  Section 53.088, Water Code, is amended to read
 125-15  as follows:
 125-16        Sec. 53.088.  Status of the District.  <(a)>  A district is:
 125-17              (1)  a governmental agency;
 125-18              (2)  a body politic and corporate; and
 125-19              (3)  a defined district within the meaning of Article
 125-20  XVI, Section 59, of the Texas Constitution.
 125-21        <(b)  A district may, through its board, sue and be sued in
 125-22  any court of this state in the name of the district.  All courts of
 125-23  this state shall take judicial notice of the creation of a
 125-24  district.  A district shall contract and be contracted within the
 125-25  name of the district.>
  126-1        SECTION 16.  Section 53.172, Water Code, is amended to read
  126-2  as follows:
  126-3        Sec. 53.172.  Ordering Bond Election.  After the creation of
  126-4  a district and the qualification of the supervisors, the board may
  126-5  order an election in the district to authorize a bond issue.  <The
  126-6  board shall set the day for the election, which must be held during
  126-7  the period beginning on the 20th day and ending with the 30th day
  126-8  after the day of the order.>  At this election, the board shall
  126-9  submit only a proposition authorizing the issuance of bonds and the
 126-10  levy of a tax to pay the bonds.  The ballots shall be printed to
 126-11  allow for voting for or against the proposition:  "The issuance of
 126-12  bonds and the levy of taxes to pay the bonds."
 126-13        SECTION 17.  Section 54.025, Water Code, is amended to read
 126-14  as follows:
 126-15        Sec. 54.025.  Qualification of Temporary Directors.  After a
 126-16  district has been organized, each temporary director shall execute
 126-17  a <his> bond in accordance with the provisions of Section 49.055
 126-18  <54.116 of this code> and shall take the <his> oath of office, and
 126-19  the board shall meet and organize.
 126-20        SECTION 18.  Section 54.036, Water Code, is amended to read
 126-21  as follows:
 126-22        Sec. 54.036.  Directors to Continue Serving.  The existing
 126-23  board of a district converted to a municipal utility district under
 126-24  the provisions of this chapter shall continue to serve as the board
 126-25  of the converted district <until the first Saturday in April
  127-1  following conversion of the district, at which time five directors
  127-2  shall be elected to serve for such period of time and in the same
  127-3  manner as provided in Section 54.029 of this code for directors
  127-4  first elected for a district>.
  127-5        SECTION 19.  Section 54.203, Water Code, as amended by H.B.
  127-6  No. 2876, Acts of the 72nd Legislature, Regular Session, 1991, is
  127-7  amended to read as follows:
  127-8        Sec. 54.203.  MUNICIPAL Solid Waste.  A district is
  127-9  authorized to purchase, construct, acquire, own, operate, maintain,
 127-10  repair, improve, extend, or establish a municipal solid waste
 127-11  collection and disposal system, including recycling, inside and
 127-12  outside the district and make proper charges for it.  A district
 127-13  may require use of such services as a condition for receiving other
 127-14  district services.  A district may enter into an exclusive contract
 127-15  with a private entity to provide such services to all land and
 127-16  persons within its boundaries.
 127-17        SECTION 20.  Section 54.729(a), Water Code, is amended to
 127-18  read as follows:
 127-19        (a)  After the board of each district has agreed on the terms
 127-20  and conditions of consolidation, which may include the assumption
 127-21  by each district of the <other district's> bonds, notes, or other
 127-22  obligations and voted but unissued bonds of the other consolidating
 127-23  districts payable in whole or in part from taxation, the levy of
 127-24  taxes to pay for the bonds, and adoption of a name for the
 127-25  consolidated district, the board shall order an election in each
  128-1  district to determine whether the districts should be consolidated.
  128-2        SECTION 21.  Section 54.730(a), Water Code, is amended to
  128-3  read as follows:
  128-4        (a)  After two or more districts are consolidated, they
  128-5  become one district and are governed as one district, except for
  128-6  the payment of debts created before consolidation if the conditions
  128-7  of consolidation do not provide for the assumption by each district
  128-8  of the <other's> bonds, notes, or other obligations and voted but
  128-9  unissued bonds of the other consolidating districts.
 128-10        SECTION 22.  Section 54.732, Water Code, is amended to read
 128-11  as follows:
 128-12        Sec. 54.732.  Assessment and Collection of Taxes.  After
 128-13  consolidation, the district shall assess and collect taxes on
 128-14  property in the original districts to pay debts created by the
 128-15  original districts unless each district has assumed the <other
 128-16  district's> bonds, notes, or other indebtedness payable in whole or
 128-17  in part from taxation of the other consolidating districts.
 128-18        SECTION 23.  Section 54.733, Water Code, is amended to read
 128-19  as follows:
 128-20        Sec. 54.733.  Voted But Unissued Bonds.  In the event any
 128-21  consolidating <either> district has voted but unissued bonds
 128-22  payable in whole or in part from taxation and the consolidated
 128-23  district assumed the voted but unissued bonds and the consolidated
 128-24  district was authorized to levy taxes to pay for the bonds, then
 128-25  the consolidated district shall be authorized to issue the voted
  129-1  but unissued bonds in the name of the consolidated district and
  129-2  levy a uniform tax on all taxable property in the consolidated
  129-3  district to pay for the bonds.
  129-4        SECTION 24.  Chapter 54, Water Code, is amended by adding
  129-5  Sections 54.739-54.748 to read as follows:
  129-6        Sec. 54.739.  ANNEXATION OF CERTAIN DISTRICTS.  (a)  Before a
  129-7  municipality may institute proceedings to annex a district, the
  129-8  municipality shall give the district not less than 48 nor more than
  129-9  60 months' advance written notice of its intention to do so.  After
 129-10  such written notice is given, the district may not issue any
 129-11  additional bonded indebtedness, extend any of its services to
 129-12  additional areas outside its boundaries, or institute any new type
 129-13  of service without the prior written approval of the governing body
 129-14  of the municipality, which approval may not be unreasonably
 129-15  withheld or delayed.
 129-16        (b)  The board of directors of the district may, by
 129-17  resolution, waive the giving of notice required under this section
 129-18  or agree to a shorter notice period.
 129-19        (c)  In this section, "district" means a municipal utility
 129-20  district created under this chapter that has been in existence at
 129-21  least 10 years, has a population of 10,000, provides water and
 129-22  wastewater services, provides parks and recreational facilities,
 129-23  provides or contracts for the provision of fire-fighting services,
 129-24  has an outstanding bonded indebtedness, and lies partly within the
 129-25  corporate limits and partly within the extraterritorial
  130-1  jurisdiction of a single home-rule municipality.
  130-2        Sec. 54.740.  Substituting Land of Equal Acreage and Value.
  130-3  After the district is organized and acquires facilities with which
  130-4  to function for the purposes for which it was organized, and votes,
  130-5  issues and sells bonds for such purposes, land within the district
  130-6  boundaries subject to taxation that does not need or utilize the
  130-7  services of the district, may be excluded and other land not within
  130-8  the boundaries of the district, may be included within the
  130-9  boundaries of the district as provided by the provisions of this
 130-10  section and Sections 54.741-54.748 subject to commission approval.
 130-11        Sec. 54.741.  Requisites for Application for Exclusion.  The
 130-12  owner(s) of land in the district not receiving services from the
 130-13  district may apply for its exclusion from the district boundaries
 130-14  if all taxes levied and assessed by the district on the land to be
 130-15  excluded, have been fully paid.  The application shall set forth
 130-16  facts concerning the land proposed for exclusion, including
 130-17  evidence of the reasonable market value of the land, and state that
 130-18  the other requisites for the exclusion of the land and substitution
 130-19  of other land have been fulfilled or will be fulfilled at the
 130-20  hearing upon the application.  The application shall be verified
 130-21  and acknowledged in a recordable form as conveyances of real
 130-22  property.
 130-23        Sec. 54.742.  Inclusion of Substitute Land Required.  An
 130-24  application for exclusion can only be considered by the board if an
 130-25  application is filed by the owner(s) of other land lying outside
  131-1  the boundaries of the district seeking inclusion of land that can
  131-2  be served in a practical manner by the district of at least equal
  131-3  value to the land proposed for exclusion, and such land must be
  131-4  included within the district boundaries and taxing jurisdiction of
  131-5  the district simultaneously with the exclusion of the land proposed
  131-6  for exclusion, and such included land must be of sufficient acreage
  131-7  to avoid an impairment of the security for payment of voted and
  131-8  issued bonds and any other contract obligations payable or secured,
  131-9  in whole or in part, from ad valorem taxes or revenues of the
 131-10  district.
 131-11        Sec. 54.743.  Application for Inclusion.  The application
 131-12  submitted by owner(s) of land proposed for inclusion, shall set
 131-13  forth that the owner(s) of the new land assumes the payment of all
 131-14  taxes, assessments and fees levied on the land and assessed by the
 131-15  district after the date the land is included in the district.  The
 131-16  application shall also set forth an agreement by the owner(s) of
 131-17  the land proposed for inclusion that the land will be subject to
 131-18  future taxes for bond tax and other assessments and fees levied and
 131-19  assessed by the district and be subject to the same liens and
 131-20  provisions and statutes governing all other lands in the district
 131-21  as though the land had been incorporated originally in the
 131-22  district.  The application for inclusion shall be verified and
 131-23  acknowledged in a recordable form as conveyances of real property.
 131-24        Sec. 54.744.  Notice of Hearing and Hearing Procedures.  The
 131-25  board shall give notice of the hearing on the applications for
  132-1  exclusion and inclusion in conformity with the notice and hearing
  132-2  requirements otherwise applicable to exclusions or additions of
  132-3  land.  The board at such hearing shall hear all interested parties
  132-4  and all evidence in connection with the applications.
  132-5        Sec. 54.745.  Impairment of Security.  For purposes of the
  132-6  board's consideration of the applications, the lands proposed for
  132-7  inclusion shall be deemed to be sufficient to avoid an impairment
  132-8  of the security for payment of obligations of the district if:
  132-9              (1)  according to the county tax rolls, the taxable
 132-10  value of such included lands equals or exceeds the taxable value of
 132-11  the excluded lands;
 132-12              (2)  the estimated costs of providing district
 132-13  facilities and services to such included lands is equal to or less
 132-14  than the estimated costs of providing district facilities and
 132-15  services to the excluded lands; and
 132-16              (3)  the district's outstanding bonds or contract
 132-17  obligations are payable in whole or in part by a pledge of net
 132-18  revenues from the ownership or operation of the district's
 132-19  facilities, the projected net revenues to be derived from the lands
 132-20  to be included during the succeeding 12-month period, as determined
 132-21  by the district's engineer, equals or exceeds the projected net
 132-22  revenues that would otherwise have been derived from the lands to
 132-23  be excluded during the same period.
 132-24        Sec. 54.746.  Board's Resolution to Substitute.  If the board
 132-25  finds that all the conditions provided for the exclusion of land
  133-1  and inclusion of other land in the district exist and that it is in
  133-2  the best interest of the district to grant such applications, it
  133-3  may adopt and enter in its minutes a resolution and order excluding
  133-4  all or part of the land proposed for exclusion and including all or
  133-5  part of the land proposed for inclusion.  Prior to the effective
  133-6  date of the exclusion and inclusion of lands, the district shall
  133-7  have received payment of all fees, charges, assessments, taxes,
  133-8  together with any associated penalties and interest due or overdue
  133-9  in the respect to the lands excluded and if no ad valorem taxes or
 133-10  fees have yet been established by the district for the current
 133-11  year, an amount determined by the district to equal the estimated
 133-12  ad valorem taxes and standby fees to be established by the district
 133-13  for the current year, prorated to the date of exclusion with
 133-14  respect to such excluded lands, shall also be paid.
 133-15        Sec. 54.747.  Liability of Excluded and Included Land.  The
 133-16  land excluded from the district is free from any lien or liability
 133-17  created on the excluded land by reason of its having been included
 133-18  in the district.  Land included in the district is subject to all
 133-19  laws, liens, and provisions governing the district and the land in
 133-20  the district.
 133-21        Sec. 54.748.  Service to Included Land.  The district has the
 133-22  same right and obligation to furnish services to the included land
 133-23  that it previously had to furnish to the excluded land.
 133-24        SECTION 25.  Section 55.101, Water Code, is amended to read
 133-25  as follows:
  134-1        Sec. 55.101.  Board of Directors.  The governing body of a
  134-2  district is a <the> board of five directors.
  134-3        SECTION 26.  Section 55.102, Water Code, is amended to read
  134-4  as follows:
  134-5        Sec. 55.102.  Qualifications of Directors.  To be qualified
  134-6  for election as a director, a person must be a resident of the
  134-7  state, own land subject to taxation in the district, and be at
  134-8  least 18 <more than 21> years of age at the time of the election.
  134-9  Section 49.052 does not apply to a district governed by this
 134-10  chapter whose principal purpose is providing water for irrigation.
 134-11        SECTION 27.  Section 55.721, Water Code, is amended to read
 134-12  as follows:
 134-13        Sec. 55.721.  Exclusion of Nonagricultural and Nonirrigable
 134-14  Land From District.  Land located in the district which is
 134-15  classified as nonagricultural and nonirrigable may be excluded from
 134-16  the district in the manner provided in Subchapter J, Chapter 49
 134-17  <Sections 51.702-51.713 of this code>.
 134-18        SECTION 28.  Section 56.064, Water Code, is amended to read
 134-19  as follows:
 134-20        Sec. 56.064.  Election of Directors.  (a)  On petition of a
 134-21  majority of the real property taxpayers of a district requesting an
 134-22  election of district directors, the commissioners court shall
 134-23  immediately order an election to be held at the earliest legal
 134-24  time.  The election shall be held as other elections under Chapter
 134-25  49 <this chapter>.
  135-1        (b)  <The commissioners court shall declare the three persons
  135-2  receiving the highest number of votes elected, and if two or more
  135-3  persons tie for the third highest vote, the commissioners court
  135-4  shall elect the third director from those tying for the place.>
  135-5        <(c)  On qualifying for office, directors elected under this
  135-6  section are the legal and rightful directors of the district within
  135-7  the full meaning and purpose of this law.>
  135-8        <(d)  The first elected directors of the district hold office
  135-9  until the next regular directors' election, and subsequent
 135-10  directors of the district are elected every four years except as
 135-11  provided by Subsection (e) of this section.>
 135-12        <(e)>  The first elected directors of the districts in
 135-13  Calhoun, Matagorda, and Victoria Counties hold office until May 15
 135-14  of the next succeeding odd-numbered year.  Subsequent directors of
 135-15  the district are elected every two years on the first Saturday in
 135-16  May in each odd-numbered year, for a term of two years beginning on
 135-17  May 15 following the election.
 135-18        SECTION 29.  Section 57.053, Water Code, is amended to read
 135-19  as follows:
 135-20        Sec. 57.053.  Term of Office, Removal, and Succession.
 135-21  (a)  <Each director shall hold office for a period of two years and
 135-22  until his successor is appointed and has qualified.>
 135-23        <(b)>  A vacancy on the board shall be filled by majority
 135-24  vote of the commissioners court <of jurisdiction>, and the court
 135-25  shall appoint directors so that the board will always have full
  136-1  membership.
  136-2        (b) <(c)>  The commissioners court <of jurisdiction>, by
  136-3  majority vote, may remove an appointed <a> member of the board.
  136-4        SECTION 30.  Section 57.060, Water Code, is amended to read
  136-5  as follows:
  136-6        Sec. 57.060.  Petition.  Before an election is held under
  136-7  Section 57.057 <of this code>, a petition, signed by at least 100
  136-8  <25> electors in the district <each county commissioners precinct>
  136-9  who are qualified to vote <at an election for directors if a
 136-10  countywide election, or by 50 electors if less than countywide>,
 136-11  shall be presented to the district <county judge> requesting that
 136-12  an election be held in the district to determine whether or not
 136-13  directors for the district should be elected and, if so, to elect
 136-14  directors to serve until the next regular director election <for
 136-15  state and county officers>.  The petition shall include the name of
 136-16  one or more nominees for each director's position.
 136-17        SECTION 31.  Section 57.061, Water Code, is amended to read
 136-18  as follows:
 136-19        Sec. 57.061.  Procedure for Election.  <(a)>  After the
 136-20  petition is presented under Section 57.060 <of this code>, the
 136-21  board <county judge> shall order an election <to determine the
 136-22  propositions presented in the position.  The election shall be held
 136-23  not less than 30 days from the date of the order calling the
 136-24  election, or the propositions may be determined at a general
 136-25  election>.
  137-1        <(b)  The election order shall designate the polling places
  137-2  which shall be the same as the polling places used in the last
  137-3  general election in the county, if a countywide election is held.>
  137-4        <(c)  The county clerk shall issue notice of the election and
  137-5  shall have the notice published in a newspaper of general
  137-6  circulation in the county once a week for two consecutive weeks.
  137-7  The first publication must not be less than 14 days before the day
  137-8  of the election.>
  137-9        <(d)  The sheriff shall post a copy of the notice at least 20
 137-10  days before the day of the election at each polling place
 137-11  designated in the election order.>
 137-12        <(e)  The district shall pay all expenses incident to calling
 137-13  and holding the election.>
 137-14        SECTION 32.  Section 57.207, Water Code, is amended to read
 137-15  as follows:
 137-16        Sec. 57.207.  Declaring Result of Election.
 137-17  <(a)  Immediately after an election under this chapter, the
 137-18  officials holding the election shall return the result to the
 137-19  commissioners court of jurisdiction.>
 137-20        <(b)  The election officials shall return the ballot boxes to
 137-21  the clerk of the commissioners court of jurisdiction, who shall
 137-22  safely keep the boxes and deliver them with the returns of the
 137-23  election to the commissioners court of jurisdiction at its next
 137-24  regular or special session.>
 137-25        <(c)  The commissioners court of jurisdiction at its first
  138-1  session after the election shall canvass the vote and the returns.
  138-2  If the proposition submitted has been approved by a majority of the
  138-3  electors of the district voting at the election, the commissioners
  138-4  court of jurisdiction shall declare the result to be in favor of
  138-5  the proposition, but if the proposition is not approved by the
  138-6  electors of the district, the commissioners court of jurisdiction
  138-7  shall declare the result to be against the proposition.>
  138-8        <(d)>  The board <commissioners court of jurisdiction> shall
  138-9  enter an order declaring the election result in its minutes.
 138-10        SECTION 33.  Section 58.072, Water Code, is amended to read
 138-11  as follows:
 138-12        Sec. 58.072.  QUALIFICATIONS.  To be qualified for election
 138-13  as a director, a person must be a resident of the state, be the
 138-14  owner of record of fee simple title to land in the district, <and>
 138-15  be at least 18 years of age, and owe no delinquent taxes or
 138-16  assessments to the district.  Section 49.052 does not apply to a
 138-17  district governed by this chapter.
 138-18        SECTION 34.  Subchapter A, Chapter 60, Water Code, is amended
 138-19  by adding Section 60.002 to read as follows:
 138-20        Sec. 60.002.  AUDIT.  Subchapter G, Chapter 49, related to
 138-21  Audit of Districts, shall apply to districts governed by this
 138-22  chapter.
 138-23        SECTION 35.  Subchapter M, Chapter 60, Water Code, is amended
 138-24  by adding Section 60.350 to read as follows:
 138-25        Sec. 60.350.  BONDS.  Section 49.181, related to the
  139-1  Authority of Commission Over Issuance of District Bonds, and
  139-2  Section 49.183, related to Bond Sales, shall apply to bonds
  139-3  supported by taxes and issued by districts governed by this
  139-4  chapter.
  139-5        SECTION 36.  Section 65.103, Water Code, is amended to read
  139-6  as follows:
  139-7        Sec. 65.103.  Election of Directors; Terms of Office.
  139-8  (a)  The persons receiving the highest number of votes at each
  139-9  election shall serve as directors of the district.
 139-10        (b)  The terms of the directors may run concurrently, or may
 139-11  be staggered, but in any event, the term of office of a director
 139-12  may not exceed three years.
 139-13        (c)  The method for determining the initial terms for each of
 139-14  the directors constituting the initial board shall be determined by
 139-15  the temporary directors, and the terms must be clearly stated on
 139-16  the ballot for the confirmation and director's election.  At
 139-17  subsequent elections in each following year in which there is an
 139-18  election, the election must be held on the same uniform election
 139-19  date as the confirmation and directors' election, and the terms of
 139-20  the directors being elected must be stated on the ballot.
 139-21        <(d)  The election of directors must be held in a district on
 139-22  one of the dates provided by Section 9b, Texas Election Code
 139-23  (Article 2.01b, Vernon's Texas Election Code).>
 139-24        <(e)  The permanent directors may assign a position number to
 139-25  each director's office, and each director subsequently shall be
  140-1  elected by position and not at large.>
  140-2        SECTION 37.  Chapter 65, Water Code, is amended by adding
  140-3  Section 65.235 to read as follows:
  140-4        Sec. 65.235.  Prohibition on Assessment or Collection of
  140-5  Taxes.  Section 49.107 does not apply to a district created under
  140-6  this chapter.
  140-7        SECTION 38.  Section 66.101, Water Code, is amended to read
  140-8  as follows:
  140-9        Sec. 66.101.  Board of Directors.  A district shall be
 140-10  governed by a board of directors composed of five members, who are
 140-11  elected as provided in Chapter 49 <by this chapter>.
 140-12        SECTION 39.  Section 66.310(b), Water Code, is amended to
 140-13  read as follows:
 140-14        (b)  Bonds issued by a district and projects and improvements
 140-15  of the district that are provided through the issuance of bonds are
 140-16  governed by Chapter 49 <Sections 54.516 and 54.517 of this code>.
 140-17        SECTION 40.  The following sections of Chapter 51, Water
 140-18  Code, are repealed:  Sections 51.033, 51.034, 51.073 through
 140-19  51.074, 51.077 through 51.084, 51.0851, 51.087 through 51.089,
 140-20  51.091 through 51.101, 51.122 through 51.124, 51.126, 51.131,
 140-21  51.132, 51.136 through 51.138, 51.140 through 51.146, 51.149
 140-22  through 51.155, 51.183, 51.191 through 51.193, 51.221 through
 140-23  51.224, 51.231 through 51.279, 51.354 through 51.363, 51.371
 140-24  through 51.375, 51.412, 51.416 through 51.418, 51.421, 51.422,
 140-25  51.4321, 51.4371, 51.601, 51.691 through 51.701, 51.714 through
  141-1  51.731, and 51.737 through 51.747.
  141-2        SECTION 41.  The following sections of Chapter 52, Water
  141-3  Code, are repealed:  Sections 52.104, 52.107 through 52.114, 52.116
  141-4  through 52.118, 52.119 through 52.121, 52.157, 52.251 through
  141-5  52.253, 52.259 through 52.262, and 52.297.
  141-6        SECTION 42.  The following sections of Chapter 53, Water
  141-7  Code, are repealed:  Sections 53.020, 53.022, 53.023, 53.025
  141-8  through 53.028, 53.035 through 53.039, 53.064, 53.065, 53.067
  141-9  through 53.070, 53.0721, 53.076, 53.077, 53.084 through 53.087,
 141-10  53.089, 53.090, 53.105, 53.106, 53.108 through 53.111, 53.114,
 141-11  53.117 through 53.120, 53.123 through 53.125, 53.141 through
 141-12  53.144, 53.147, 53.148, 53.173 through 53.175, 53.1791, 53.197,
 141-13  53.198, and 53.231 through 53.273.
 141-14        SECTION 43.  The following sections of Chapter 54, Water
 141-15  Code, are repealed:  Sections 54.026 through 54.029, 54.103 through
 141-16  54.126, 54.202, 54.204, 54.209 through 54.233, 54.301 through
 141-17  54.312, 54.506, 54.507(a), 54.509, 54.5121, 54.513, 54.516, 54.517,
 141-18  54.519, 54.701 through 54.727.
 141-19        SECTION 44.  The following sections of Chapter 55, Water
 141-20  Code, are repealed:  Sections 55.030, 55.033 through 55.036,
 141-21  55.052, 55.104 through 55.106, 55.109, 55.111 through 55.116,
 141-22  55.118 through 55.128, 55.162, 55.164, 55.168 through 55.184,
 141-23  55.189 through 55.191, 55.199, 55.203, 55.252, 55.291 through
 141-24  55.304, 55.331, 55.423 through 55.430, 55.451, 55.453, 55.492
 141-25  through 55.496, 55.503, 55.506, 55.711 through 55.720, and 55.722
  142-1  through 55.749.
  142-2        SECTION 45.  The following sections of Chapter 56, Water
  142-3  Code, are repealed:  Sections 56.027 through 56.031, 56.062,
  142-4  56.063, 56.065 through 56.068, 56.076 through 56.081, 56.083,
  142-5  56.113, 56.114, 56.119, 56.129 through 56.134, 56.136, 56.138,
  142-6  56.139, 56.183, 56.184, 56.2045, and 56.714 through 56.725.
  142-7        SECTION 46.  The following sections of Chapter 57, Water
  142-8  Code, are repealed:  Sections 57.052, 57.054 through 57.056, 57.062
  142-9  through 57.070, 57.095 through 57.099, 57.106, 57.107, 57.109,
 142-10  57.110, 57.112 through 57.115, 57.119, 57.120, 57.171 through
 142-11  57.174, 57.178, 57.202 through 57.206, 57.2075, 57.209 through
 142-12  57.211, and 57.276 through 57.278.
 142-13        SECTION 47.  The following sections of Chapter 58, Water
 142-14  Code, are repealed:  Sections 58.033, 58.034, 58.073, 58.074
 142-15  through 58.083, 58.085 through 58.088, 58.090 through 58.100,
 142-16  58.123, 58.124, 58.131, 58.132, 58.135, 58.139 through 58.149,
 142-17  58.151, 58.152, 58.169, 58.179, 58.187 through 58.189, 58.221
 142-18  through 58.224, 58.261, 58.317, 58.354 through 58.362, 58.442,
 142-19  58.451, 58.452, 58.601, 58.691 through 58.701, and 58.714 through
 142-20  58.725.
 142-21        SECTION 48.  The following sections of Chapter 65, Water
 142-22  Code, are repealed:  Sections 65.024 through 65.029, 65.104 through
 142-23  65.122, 65.202, 65.204, 65.209 through 65.234, 65.301, 65.401
 142-24  through 65.409, 65.509, 65.512, and 65.514, and 65.701 through
 142-25  65.722.
  143-1        SECTION 49.  The following sections of Chapter 66, Water
  143-2  Code, are repealed:  Sections 66.022 through 66.029, 66.103 through
  143-3  66.117, 66.119, 66.120, 66.203 through 66.205, 66.208 through
  143-4  66.215, 66.301, 66.302, 66.305 through 66.309, 66.312, and 66.323.
  143-5        SECTION 50.  (a)  This Act takes effect as provided by this
  143-6  section.
  143-7        (b)  Section 49.103(b), Water Code, shall govern all
  143-8  elections held after December 31, 1995.  Directors elected at any
  143-9  election held between January 1, 1992, and April 30, 1992, shall
 143-10  serve until the January 1996 election.  Directors elected at any
 143-11  election held between May 1, 1992, and December 31, 1992, shall
 143-12  serve until the May 1996 election.  Directors elected at any
 143-13  election held between January 1, 1993, and April 30, 1993, shall
 143-14  serve until the January 1996 election.  Directors elected at any
 143-15  election held between May 1, 1993, and July 31, 1993, shall serve
 143-16  until the May 1996 election.  Directors elected at any election
 143-17  held between August 1, 1993, and December 31, 1993, shall serve
 143-18  until the May 1998 election.  Directors elected at any election
 143-19  held between January 1, 1994, and April 30, 1994, shall serve until
 143-20  the January 1998 election.  Directors elected at any election held
 143-21  between May 1, 1994, and December 31, 1994, shall serve until the
 143-22  May 1998 election.  Directors elected at any election held between
 143-23  January 1, 1995, and April 30, 1995, shall serve until the January
 143-24  1998 election.  Directors elected at any election held between May
 143-25  1, 1995, and July 31, 1995, shall serve until the May 1996
  144-1  election.  Directors elected at any election held between August 1,
  144-2  1995, and December 31, 1995, shall serve until the May 1998
  144-3  election.  Directors whose terms expire prior to the election date
  144-4  set by this section shall continue to serve until their successors
  144-5  have been elected and qualified.
  144-6        (c)  All other provisions of this Act take effect September
  144-7  1, 1995.
  144-8        SECTION 51.  The importance of this legislation and the
  144-9  crowded condition of the calendars in both houses create an
 144-10  emergency and an imperative public necessity that the
 144-11  constitutional rule requiring bills to be read on three several
 144-12  days in each house be suspended, and this rule is hereby suspended,
 144-13  and that this Act take effect and be in force according to its
 144-14  terms, and it is so enacted.